SUPERANNUATION.

New Zealand Herald, Volume LXVI, Issue 20343, 26 August 1929, Page 14

SUPERANNUATION.

Sir,—l am not a railway employee, nor will I receive superannuation when I retire, nevertheless I cannot allow to pass unchallenged "Taxpayer's" statement that it would have cost "Ex-Railwayman" £I6OO to provide himself with an annuity of 9s 6d a day. "Railwayman's" .£3OO, paid in 480 equal instalments over a period of 40 years, would produce at, say 5 per cent, compound interest, somewhat mnro than £9BB at the end of that period. This amount at 5 per ceTit, would produce, a perpetual annuity of" about 3s. If, however, 9s 6d a day were withdrawn in -payments of £l4 5s a month, the £9Bd capital, increasing at, say- 5 per* cent, compound interest, would bp reduced to zero in about six and two-third years, /in actuary will verify these figures, which allow no profit foj- insurance companies. This grateful country is not quite so lavish with its gifts as friend "Taxpayer" would have us believe. Evidently "Ex-Railwayman" is expected to live for a further six and two-third years. May ho livo much longer. Logarithm.

Kir,—lt seems to me that "Civitis" is attempting to drag a herring across the trail. How does lie reconcile his figures with the official statement that the tax« payer has to make good a deficiency of £2,000,000 in the superannuation fund ? It may ease "Civitis' " mind if I tell him that I have hitherto paid my bills punctually, and, in spite of hard tiroes, I have hopes of being able to do so to the end of the chapter, out of my life's savings, without asking for outside assistance. My "pen-name" of "Unemployed" is adopted in the interests of the class most vitally affected. Unemployed.

Sir, —"Taxpayer" is very much out of perspective with regard to railway superannuation computation. Each year of service counts one-sixtieth of a member's wage for superannuation allowance; forthy-sixtieths or two-thirds, of a member's wage is the maximum allowance he can draw. Percentages are deducted from a member's monthly pay and vary according to age at joining the serviceLast year the superannuation fund shows a total receipt of contributions and interest of £199,925, against a. total expenditure of £188.553. The accumulated fund stands at £1,134,015. Af'tejr railway grants are made to the fund when a deficiency arises, the railway returns a profit of over 3 per cent., bo that taxpayers do not contribute a penny taxation toward railway superannuation. Ex-Railivay.