A Universal Contributory Pension

NZ Truth, Issue 978, 23 August 1924, Page 7

A Universal Contributory Pension

Would Encourage Thrift

The Common Fund Dole, Based on What Old People Don't Possess, Incomplete

There is still m the community a fund of thrift which, capitalised and controlled by the State, will support a universal contributory pension. But thrift. is not being encouraged by the present old age pension scheme, which is but a part (and not the most important part) of a still unrealised system of Statesubsidised and industrially-subsidised self-support. ;

' Admittedly, the qld age pension is no encouragement to thrift. In the proportion that a man saves and accumulates before his pension age, his old age pension will be reduced, or, perhaps lost altogether.. In the proportion that he earns after his pension age, the same danger will dog his pension. . T.he less the old age •pensioner - earns br owns — above -a certain figure— the greater his reward m the way of pension. v The unthrifty man is just as sure of something as the thrifty man is sure of nothing. To that extent the old age pension is an- encourage'merit to the lazy, and a discouragement to the industrious and provident. Bad Luck May Wreck Thrift. . To say that is not to say that all old age pensioners are people who have jiaed little or no effort. It often happens that the frugal „ and energetic are poor through ' sheer misfortune.! And they constitute the best class of old age pensioner. But, oven m their case, the pension is a mark of undeserved failure, not of deserved success. Such an old age pension never can be the mark of deserved, and successful thrift winning through to an independent status. ' As soon as thrift succeeds m making old age independent, it automatically puts old age beyond the . pale of the old age pension. Someone wilf anpwer: "But .an old age pension is not for the independent; it is for the dependent." Without admitting thatT principle, one may attack it from another angle, by asking: ■ "Is it the purpose of an old age pension system to manufacture dependants by confining its attention to them alone?" Surely a system that includes* m its aims the relief of! -the undeservedly, unsuccessful should not become, m thej eyes of many people, a reward for nonsuccess. - ; . A Missing Ingredient. A pension scheme that does not contain, as an essential ingredient, direct-

contributions from the pensioner m his earlier life, and which regards as a disqualification the possession of even a moderate amount of property, merely places the pensioner m the position of receiving money taken out of the common ("Consolidated") fund, to which he has' made no contribution save indirectly as a member of the community. The thought that the pensioner is enjoying, m his old age, that which with his own hands he largely built up, is absent. So a "Consolidated" fund pension, contingent on what a man doesn't own, is clearly incomplete. The time has come to give everyone a chance to contribute towards his own State-subsidised and State-guaranteed pension. Most public servants do it now. And, of course, there 4 s the National Providen.t Fund, but it is for people of limited income. Life insurance does not meet the case. Many of the extra thrifty have ctimbed by that ladder. It is a useful ladder. But the State should provide an easier ladder, m the shape of a universal, contributing pension. Between the steep ladder of life insurance, and the toboggan slide that leads to old f age pension, there is an hiatus. s .... m Complaints Against Present System. With regard to occasional complaints from existing or would-be, old age pensioners, that their thrift is being used against them for reduction or cancellation of pension, or for refusal of application, it should -be pointed out the New Zealand Tensions Department has to administer the law as passed by Parliament, and Parliament decided on a non-contributory pension based not on industry but on the Consolidated Fund. Behind the 'law the department cannot go. Its field is not policy, but. administration. ' A hopeful and noteworthy feature is that Labor members of Parliament seem to be giving the contributory pension idea much more favorable attention than was the case a f ew" : years ago. *.■•'; A universal scheme of pension should be the next big. objective of Statecraft (If. New Zealand has any).