SECURITY PROPOSALS

Manawatu Standard, Volume LVIII, Issue 230, 27 August 1938, Page 10

SECURITY PROPOSALS

FARMERS’ UNION VIEW. METHOD OF FINANCING. WELLINGTON, Aug. 27. The contention that the financing of the Government’s social security apart from the Is in the £> will fall heavily on the wage-earner, small business man, and farmer is made in a statement issued yesterday by the New Zealand Farmers' Union. “The present proposals are in no sense superannuation, but are a very much extended scheme of pensions,says the statement. “We hold that toe essence of superannuation is that during the years the beneficiaries provide the funds from which the benefits are paid. Superannuation funds build up the capital of the Dominion, thereby making possible greater production and a higher standard of living. The scheme as proposed will increase consumption, but will tend to decrease production, causing a strain on the resources of the Dominion. “The ability of the country to pay the cost of the social security scheme is the most important consideration in deciding its practicability. Within a year or two of the coming into force of these proposals, the total' liability will exceed £20,000,000 a year, and, even assuming that the estimate of the personal income of individuals in the Dominion of £150,000,000 is realised, it’will represent 13 1-3 per cent, of the ‘national income,’ or 2s»Sd in the £. To a person earning £5 a week this means that, by one means or another, he will have to pay about 13s 4d a week. It is true that the proposed social security contribution represents only a fraction more than 5s a week, but the balance of the money must be found, and there is only one place from which it can be obtained —from those people who are earning. “If it is obtained by means of increased Customs duties, then the cost of living will be increased and in that way the ordinary person will make his contribution. It may be suggested that it can be taken from the large incomes of the wealthy people, but, in fact, if tlie income tax was increased to 20s in the £ on the whole of the income assessable for income tax in New Zealand. large and small, it would still be between £3,000,000 and £4,000,000 short of meeting the whole of the requirements. The aggregate of taxable balances for the year 1936-37, as given in the February Abstract of Statistics, was £16.483,000. “If all the incomes over £3OO a year as returned for the income tax year 1936-37 were taken leaving nobody with more than £3OO a year we would obtain £21,890,000. This is not enough to finance the Government’s proposals and the other £3,000,000 now being spent from the Employment Promotion Fund for employment purposes.

FINDING THE, MONEY. “It is evident that the major amount of the money required must be raised from the ordinary wage-earning, smallsalaried, persons, and small business people, and the farming community. “Most of the other sections can pass on a considerable amount of the increased costs, but the producer for export cannot do so, and we are very gravely concerned indeed about the effect of such huge additions to his costs, especially in view of the downward tendency of overseas markets. While most of the benefits proposed in the Bill are in themselves quite laudable, they must be viewed with some regard to their effect upon the rest of the community. It seems to us that people will be entitled to-benefits who will, in some cases, be in a better position than many of those who will have to provide the money from which these beneficiaries will be paid. For instance, under the widows’ benefit, it will be possible -ior some young women entirely without encumbrances to obtain a pension at the age of 34 or 35. Hale and hearty men of 60 in receipt of an income of £l3O a year can obtain 30s a week and in addition 5s a week for every child under 16 they may have. “Under the sustenance proposals an able-bodied man with a wife and four children can draw £2 15s a week without working, while under the Agricultural Workers’ Act a farm-worker is expected to work for £3 2s 6d a week and pay 3s 6d a week social security contribution, and in addition will have to bear his share of the balance of the money required.” FRIENDLY SOCIETIES’ PART. MINISTER’S OUTLINE. Per Press Association. WELLINGTON, Aug. 26. The Government’s social security proposals were the main subject discussed at the annual conference of the Dominion Council of Friendly Societies, this week, and ' discussions were held with Hon. W. Nash, who is in charge of the Bill, Hon. P. Fraser (Minister of Health) ana Hon. W. Lee Martin (Minister in Charge of Friendly Societies).

Yesterday a .letter was received from the Minister of Finance setting ouir tlie provisional arrangements which might affect the Friendly Societies in the administration of the social security proposals- and this, together with the report of other matters dealt with hv the conference, was made available to-day.

In his letter Mr Nash draws attention to the following eight points:— (1) Sickness benefits will not affect tlie right of members to receive full sickness benefit from the Social Security Fund so long as the income during sickness is not over, £5 a week. (2) The Bill provides for the payment through the Friendly Societies of sickness benefits payable to members out of the Social Security Fund. The Government will extend this provision to associate members if such a course is found practicable and economic.

(3) If practicable, the Government will accept the suggestion for the utilisation of the societies for the payment of sickness benefit to persons in the household of a member, and in the small centres where an office of the department is not warranted. If necessary, provision will he made in the Bill to use established or other facilities if a satisfactory procedure can be worked out. (4) The Minister sees no reason why medical certificates under the scheme should not bo available also to societies. (5) The Minister recognises that the societies should be adequately reimbursed for the expense of any service undertaken on behalf of the Social Security Fund. (6) Careful consideration will be given to the request that- the medical examination of candidates to Friendly Societies should be included in the range of service under the medical benefits. (7) The funeral benefit from a Friendly Society is already excluded from the definition of income in determining the rates of benefits, and the Minister will be glad to give careful consideration to the request that sickness allowances should be similarly excluded. > . (8) The Minister indicates tlfe inclusion of Friendly Societies’ representatives with special knowledge and ex-

perience of the problems of administration on the committees in respect of | health benefits. Mr Nash repeats the assurance that the Government is anxious to afford every encouragement to the continuation and progress of the Friendly Society movement, and apart from the further discussions with their representatives which will be necessary in the inauguration and administration of the benefits under the Bill the Government will welcome the opportunity .of consultation on any subjects affecting the movement. He extends the thanks of the Government for the spirit of cooperation shown in the discussions with himself and the other Ministers, also for the help given from time to time to the Government officials engaged in the preparation of the Bill. PROSPECTS FOR FUTURE. The report of the conference proceedings includes the chairman’s reference to the delegation which placed evidence before the Select Committee. The delegation was congratulated by the committee that the evidence had been most informative and most valuable as a guide in the framing of the scheme, and a promise was made of the fullest use being made of the societies’ machinery in the carrying out of the schemes. “In this connection)” said the chair-, man, “the delegates would recognise; that modern trend indicates the in-, evitability of some such system coming , into operation whether we or any sec- - tion of the community oppose it or not, :■ and although some members may think ” it a disadvantage to the Societies it is our duty to make the: fullest investigation and co-operate as', far as possible in any extension of our;;’ great activities, and by such co-op-,; eration we will sustain the operation of' : our societies to the material advantage ) of the members and the community.”% Whatever the effect of the social so-; curitv scheme, he added, there would,; still be a wide field for the exercise oft their benevolent and social activities. Mr Gregory concluded by expressing; sincere thanks to those who had given; time and thought in organising andcollating information for the consid-.'. eration of the council. I' It was resolved that the members of ; the executive, with the addition of Mr McNabb, who met the Ministers on' Monday, be empowered to finalise th« , matters raised in the discussions. f : RETURNED MAN’S VIEW. Per Press Association. \ AUCKLAND, Aug. 26. "We will get nothing out of the Government social security plan,” declared a member of the . Auckland R.S.A. at the association’s quarterly, meeting. He deplored the fact that the allowances embraced provision for four children only. j The president (Mr J. W. Kendall) ’ explained that a further Bill would be introduced this session dealing with the position of returned soldiers.