THE NORTHERN ADVOCATE Registered for transmission through the Post as a newspaper. FRIDAY AUGUST 5, 1949. Social Security's Cost

Northern Advocate, 5 August 1949, Page 4

THE NORTHERN ADVOCATE Registered for transmission through the Post as a newspaper. FRIDAY AUGUST 5, 1949. Social Security's Cost

The annual report of the Social Security Department, which was presented to the House of Representatives yesterday, goes far to strengthen a fear that a commendable scheme in principle may become so costly as to imperil its stability or the capacity of the people to maintain it. It is arresting to loam that Social Security benefits, excluding the cost of medical and allied services and of war pensions, amounted during last financial year to £34,455,758, an increase of £1,631,433 on the previous year’s total. When it is recalled that the estimate for medical, hospital, pharmaceutical and other benefits was set in last year’s Budget at £7,562,000, the Dominion’s expenditure, under the heading of Social Security, indeed constitutes a big load to be carried by a population of roughly one and threequarter million men, women and children. In the ten years 1940 - 1949 the cost of Social Security has mounted from approximately £9,500,000 to £34,500,000, a growth out of proportion to the increase in population. There is a disposition on the part of many people to assume that social benefits are conjured out of thin air, whereas the truth is that they have to be paid for by the taxpayers. This suggests not only that the utmost care should be taken in the expenditure of money collected from the people in the shape of Social Security taxation, but that everything possible should be done to increase the economic stability of the Dominion, which depends ultimately upon increasing primary production and ensuring that costs are not allowed, as they threaten to do in many cases, to swallow the fruit of efforts to increase output. This is a matter which calls for serious attention in times of prosperity rather than in times of adversity, in order that there may be built up a reserve for use when it is most needed. At least one branch of Social

Security—that affecting medical and pharmaceutical benefits—has already moved influential sections of the community to urge that an overhaul is imperative. It is a recognised fact that while some taxpayers are loath to seek medical advice unless they obviously need it, there is a great host who, imagining that medical advice and medicine are free, abuse a system which, faithfully administered, would be of real benefit to a class of people who most need assistance. The cost of medical and pharmaceutical benefits has reached staggering proportions, and it may well be asked whether the time is not overdue for a thorough examination of the whole structure of this branch of Social Security. It is desirable, of course, that those who require medical advice or hospitalisation should receive it, but the taxpayers, especially those who do not abuse medical benefits, should feel that the tax they pay is being used to the best possible advantage, which cannot be said today. It is also necessary that there ought to be recognition of the fact that the cost of Social Security benefits should be carefully scrutinised, in order that money taken from the people in the shape of taxation shall be used to maximum advantage, which requires the elimination of unnecessary costs. It is generally admitted that heavy taxation is an effective brake upon a country’s progress. This justifies the contention that, simultaneously with effort to keep taxes at as low a point as possible, care should be taken to ensure that revenue raised for a specific purpose —as in the case of Social Security—is used economically and to the best advantage. If these things are done, and costs generally arc stabilised, the fullest exploitation of the Dominion’s primary production will not be in vain. These reflections inevitably obtrude when the height to which Social Security and other payments have ascended in this country is surveyed.