UNEMPLOYMENT FUNDS

Nelson Evening Mail, Volume LXVI, 7 April 1934, Page 11

UNEMPLOYMENT FUNDS

THE “CASE-IN-HAMD” POSITION EXPLANATION BY THE BOARD OBJECT OE POLICY ADOPTED Referring to the close attention being given at the present time to the cash in hand balance in the unemployment fund as disclosed in the Gazette No. 7 published on 7th February last, the Unemployment Board to-day issued the following statement:— Cas’d in hand does not necessarily menu a cash balance available for expenditure or distribution—it is necessary to know to what extent it is already committed or owing. A monthly income and expenditure statement of the board’s fund dating nearest to the figures from which :Jie casly in hand figures were quotvl, chewed, inter alia, that tile commitments entered into by tile board exceeded the income received bv over £600,000. To say however, that the board’s fund was over-expended to that amount would be as wide ot the mark as it is to regard the cash in band as being available for new commitments, because it was known ami indicated in the same statement that over £600.000 of the commitments would not fall due for payment until nicer tl e date covered by the funds received. In other words, they were forward commitments.

It will help to create an understanding of the ‘cash in hand” position when it is icalised that in general practice, with a proportion of the relief payments made through local bodies as employing authorities to whom refund is made only after a check of the wages sheets is made by the board’s officers, at any given date there are payments outstanding for refunds of wages already w °i’kers, in ;h. 3 vicinity of 400.000. A further factor visibly increasing the cash in band is accounted lor by the board’s recent practice of carrying its own insurance against compensation for accidents. Owing to the fact that the sum set aside a? premiums against this liability is not removed to a separate fund, the cash in hand balance has been consequently increased. It has been correctly deducted, however, li-om the figures as published in the Gazette, that the board’s income for the financial year just ended will be greater than !t was for tile year ended 31st March 1933. A perusal of the unemployment figures for the same period will reveal that the numbers of unemployed increased substantially also. R may with advantage be again stated that, now the end of the financial ycai has arrived, many of those who are wondering what lias become of the increased income were confident at the beginning of the year that the board’s income would be qiute inadequate to pi ovide for tile 100,000 registered unemployed they so confidently anticipated, ino itself is not so sure that the 100,000 figure would not have been reached if the building industry had not been revived by the stimulant of a subsidy on wages. This stimulant lias bad to be provided from the funds available, and it may be that the board’s practice of making immediate provision for commitments entered into has kept aside a sum for commitments onder Scheme 10 out of the year’s revenue which was not earned and therefore did not fall due for payment until after the 31st March. This no doubt was accounting for some of the cash in hand at the end of December.

Referring to another point generally made when drawing attention to the cash baalance. that relief workers were {retting loss during the past year than during the previous year: it does not tell the full story. The board’s policy during the year under review has been directed more to encouraging and stimulating full-time employment at standard wages than to the improvement of sustenance payments. The value of this policy is not to be determined merely by a comparison of sustenance payments in the two periods, but by, a realisation of the fact that, although the last financial year promised to be the most difficult year of the depression, and although the total number of workers who failed to find employment under normal conditions reached its peak for New Zealand, the number to-day who are in receipt of intermittent relief only under Scheme 5, or are on sustenance, is the lowest on record since April, 1931. In the majority of cases the effect of the policy of a diversion to full-time employment has been a heavier direct drain on the fund than would have been the case if sustenance were paid. The majority of men placed in full-time employment, however, have been engaged in reproductive work, and have by their employment provided additional employment for others; thus preventing the numbers of unemployed from reaching the high limits which appeared inevi table had any other course been taken