EMPLOYEES' SUPERANNUATION

Evening Star, Issue 19713, 14 November 1927, Page 4

EMPLOYEES' SUPERANNUATION

—. —t- - J. RATTRAY AND SON’S SCHEME Messrs J. Rattray and Son, Ltd., who have over 100 employees in their head office at Dunedin and their various branches, are now completing a superannuation scheme which combines the best features of the pension schcme and the group assurance scheme. Their scheme will provide a minimum pension of £l5O per annum for the members of the office and travelling staffs and a minimum pension of £IOO per annum for the members of the store staffs upon their attaining the age of 60 years. The scheme will also protect each member of the staff with a life assurance policy from the date of the commencement of the scheme for an average amount of between £6OO and £7OO, dependent upon ago and Salary. All this is done without the finding of any large capital sum. r £ho company will take no risk with tho life insurance policies, as an arrangement has been made with the Australian Mutual Provident Society to cover the whole of the male members of the staff under tho age of 55 years with its ordinary endowment policies payable at tho age of 60 years. These policies, tho cost of which is paid equally by tho staff and the firm, are held by trustees, two of whom are appointed by the directors and two elected by tho stall'. Each member of tho scheme, upon attaining the age of CO years, elects whether he will take tho amount of liis policy, with, bonuses, in a lump sum or whether he will leave the amount at interest with the trustees and draw a yearly pension. Should tho employee die his widow will receive tho residue of the amount that would have been duo to him at tho age of 60 years, less 10 per cent. Should he die before bo has i reached tho retiring age his widow receives his lifo insurance money, less 5 per cent. In order to provide for those members of the staff who may outlive the actuarial expectation of lifo a reserve fund is established, and a small deduction is made from all amounts which would bo paid out either through the death of the policyholder or from .the lump sum ho has the option of taking at tho age of 60 years. In addition to the £ for £ contribution from the amount of salaries paid the employees, in order to provide the minimum pensions of £l5O and £IOO per annum, it is, of course, necessary in the ease of certain of the older employees that a considerable sum of money will have to be found at the dates when the accumulated funds standing to the credit of those who have gone on pension have become exhausted, and this amount is provided by means of endowment assurance on the life of a young member of the start'. Although the Government makes no direct contribution to tho cost of these staff assurance and pension schemes, yet in an indirect way it does,, ns, through the company being- able to deduct the total amount it pays in premiums from its income tax returns, it considerably reduces the amount of tax it would otherwise have to pay. Since this scheme by Rattray and Son has been planned it has attracted widespread notice, and from all quarters one bears it commented on favorably, as having no apparent defects and as likely to bring about the desiderata of goodwill between employer and omployedj the prevention of economic waste m keeping on hands who are past efficiency, and in giving security and a brightened outlook to employees who have clone their work well. The firm is to be congratulated on giving a lead in this way to other employers who would like to act, but have not found out how to do so wisely.