SUPERANNUATION BILL

New Zealand Herald, Volume LXIX, Issue 21349, 25 November 1932, Page 14

SUPERANNUATION BILL

EVIDENCE TO COMMITTEE

STATE OF TEACHERS' FUND

SENIOR OFFICIALS' CASE

[TI V TKLEflll APII —Sl' K( ■IA I, UK I.'OI 1 T I'. I: ] "WE LLI NO TON. Thursday The views of university contributors to the Teachers' Superannuation Fund, the Teachers' Superannuation Hoard and the Civil Service Institute on the (government {Superannuation Funds J»ill were placed before the Parliamentary Committee today.

Professor R. .1, T. Hell "submitted that if the present rate of contribution was maintained, it was no more than justice to university contributors that the £3OO limit should be removed. Even if that were done, the position arose that university contributors generally provided full actuarial value of the pensions they obtained, while the contributions of others who paid on increasing salaries had to be subsidised to provide their pensions. Evidence as to the position of the Teachers' Superannuation Fund was given by Mr, 0. E. Crawford, lie said the reductions in salaries had accounted for a fall in contributions to an extent of at least £25,000 per annum and a reduction in interest of approximately £IB,OOO was caused by the reduction under the National Expenditure Adjustment Act, 1932, and by the. realisation of investments in order to meet expenditure. The rebate to contributors who did not elect last year to continue to contribute on the basis of salary prior to the reductions on April 1, 1931, amounted to £20,970. Teachers' Fund Investments

The yea f 1031-32 was 1 lie tiist year in which income was less than expenditure, the deficiency being £53,985. This year investments to the extent of £70,000 had already been realised and tho money used for allowances, etc. In vestments at present amounted to £1,147,000, of which £51,800 is Government stock at 5£ per cent and per cent, and £135,040 rural bonds at 5 per cent. Tho balance was nearly all on mortgage at 6 per cent, now reduced to 5 per cent. The amount of interest on mortgage duo and unpaid was much greater than in previous years. For instance, the amount in January, 1930. was £1911: in January, 1931,. £3862; in January, 1932, £13,315." Tho Civil Service Institute, representing tho senior administrative officers of all departments of the Public Service, contended that tho immcdiato objective was to place the funds in a sound financial position and riot to enter into recriminations as to how the present position had been brought about. It was essential, however, that the general taxpayer should realise that the present position was mainly due to the fact thai, contributing officers had had, in effect, to meet tho Government's dishonoured promissory notes. That those promissory notes were not dishonoured on account of inability to pay was evidenced by tho fact that during the period since the inception of tho funds, the aggregate of Budget surpluses to March 31, 1930, exceeded £33,960,000. Yet promissory notes to an amount of £2,036,000 odd were dishonoured during the same period. Monthly Payments Urged

In the case of tho Public Service and Teachers' Funds, tho institute emphatically protested against being called upon to share 011 a 50-50 basis -with the State, a deficiency which was entirely the Government's and not in any particular that of contributors or annuitants. The institute was moi-t emphatic that in the amendments now to be made, whatever payments were t > be borne by the Government, should be | : d each month coincidentally with p.ay me: ' by contributors, and should bo automatic under the authority of the amending Act without further appropriation than tho Act.

If tlie proposals in the bill were given effect to in their entirety, the institute strongly desired that the control and administration of funds be placed independently and absolutely in the hands of commissioners with responsibilities of trustees, appointed from the service, of whom the Government Actuary should be one.

The institute trusted that no postponement of the bill would be contemplated, unless at least sufficient finance was provided t<> prevent any further increase in the existing deficiency and steps were taken to prevent any further loading on to the superannuation funds of disastrous and compulsory premature retirements.