BIG PENSIONS BILLS

New Zealand Herald, Volume LXIX, Issue 21298, 27 September 1932, Page 9

BIG PENSIONS BILLS

INQUIRY IN AUSTRALIA CONTRIBUTORY SYSTEM MOOTED [from our own correspondent] SYDNEY, Sept. 15 Behind the decision of the Federal Government to investigate the possibility of devising a new scheme for providing old age and invalid pensions is a desire to remove these pensions entirely from political control. Much time has already been spent by the Cabinet in discussing this question, which is surrounded by so ninny difficulties that it is impossible for Ministers to formulate any concrete proposals without full inquiry.

The suggestion of one membfer of the Government Party to regulate the rate

of pension in accordance with the cost of living figures has been discussed by Ministers, but is regarded as impracticable. An outstanding objection to this has been raised by the Treasury, which points out the difficulties of budgeting on the basis of a pensions scheme for which the Government's liability is likely to fluctuate considerably from quarter to quarter. No Treasurer, in preparing his Budget, is likely to be gifted with sufficient psychic powers to enable him to forecast the variations in the cost of living. There is a general feeling in Ministerial circles that the increasing burden of the old age and invalid pensions bill is getting beyond the ability of the Federal taxpayers to bear, and that it might be possible to institute a contributory system. The Cabinet has not yet decided whether the proposed inquiry shall be a Royal Commission, a Parliamentary Committee, an expert committee, including outside authorities, or a purely departmental committee. A Royal Commission is not favoured by a section of the Ministry on the ground of expense and the possibility that the Government's prestige might suffer if it appoints too many Royal Commissions. It is recalled that the Royal Commission appointed by the Bruce-Page Government to investigate national insurance sat for about two years, was unduly expensive, and produced such a complicated and comprehensive scheme that the Government of the day was not enthusiastic about going ahead with it. Even the ambitious proposals of this Royal Commission did not include a substitute for the present old-age and invalid pensions scheme, which, it was intended, should not be 'interfered with. The Ministry has ideas of a National Provident Fund being established for the benefit of aged and permanently invalided persons. Who should contribute to this scheme, and on what basis, are questions calling for an exhaustive inquiry.