SUPERANNUATION

New Zealand Herald, Volume LXX, Issue 21454, 30 March 1933, Page 13

SUPERANNUATION

Sir,—ln all recent letters on the largo allowances paid to a small group of superannuitants tho matter of tho Government's default is never mentioned. The superannuation scheme of 1907 was, no doubt, based on actuarial calculations. The actuaries estimated that contributions ranging from 5 to 10 per cent of salaries, adequately subsidised by the State, would bo a pound proposition. Tho Government fixed the rates and all tho conditions and regulations governing retirement. Tlio civil servants loyally accepted tho scheme as drafted and have paid up to a man. The scheme sagged in one respect; after a few desultory annual subsidies were paid the Government ceased paying in—they defaulted. I understand the British Government has not interfered with its superannuation schemes and our local banks, insurance companies and local bodies are not meddling with their superannuation provision for their officers. Also, all life insurance offices are playing the game with policy-holders whose claims have matured ; it is left for those in high places to show a sapping of morals in regard to tho sacredncss of contracts —a superanuation allowance, like a life policy, is a "commitment" —it is not a pension or a gratuity. Why tho dead set at a group of Euperannuitants drawing large allowances? They gave honest service to the State, and, being alive, their luck is in. Retired officials get no sympathy from the public; public sympathy is with the old-nge pensioners. Yet old-age pension funds wero not and arc not supplemented by special contributions from prospective beneficiaries; civil servants, like the rest of the community, are taxed for these charges—they also pay unemployment tax, income tax. etc., like other citizens; hence, all the talk about "privilege" is nonsense. Present old-age pensions for man and woman are £4O 19s and £35 19s respectively. The cost of buying annuities at tho qualifying ages from a leading life offico would be £640 and £520 respectively, or, capitalised at 4 per cent. £IOOO and £9OO. Thus a huge capital cost is involved in old-age pensions. The superannuation capital cost is, I think, small by comparison. I suggest that our critics explore in other directions to effect economies ; their present objective is sheer exploitation. • * K.H.