SUPERANNUATED CIVIL SERVANTS

Otago Daily Times, Issue 21627, 23 April 1932, Page 8

SUPERANNUATED CIVIL SERVANTS

TO THE EDITOR Sir., —Following on “Inquirer's” letter, I would like to make n suggestion whereby the Government. could effect a saving in expenditure of £450,000 per annum. This could be brought about easily gnd justly be withdrawing the Government contribution to civil servants’ superannuation funds. Your footnote to “Inquirer’s” letter states that “ it may be argued that superannuitants have bought the benefits they enjoy, ” But have they bought these benefits? Actuaries inform us that the superannuation funds are actuarially unsound. If this is correct the civil servants are not buying the benefits they hope to 'enjoy; they are getting something more than they are paying for. To remedy this state of affairs, one or two things must take place. Either the contributions must he increased or the benefits must he reduced. But what is really taking place? If one refers to the Official Year Book for 1931 the following figures will he found for the last year referred to: —41,740 Government employees—railway, education, and general employees—contributed £580,350 for the year, while the Government contributed for the same year £454,787 from the Consolidated Fund to bolster up these actuarially unsound funds. Would any insurance companyhe prepared to give the benefits that civil servants enjoy in return for the amounts at present contributed by them? I venture to say that no insurance company would entertain such a proposition for a moment.

The Economy Commission has recommended that the National Provident Fund lie made self-supporting and that the Government contribution be withdrawn. Let the civil servants’ funds he put on the same self-supporting basis and this substantial contribution of £450,009 be saved. By nil means retain these superannuation schemes, hut pay retired civil

servants only what they buy—no more and no less. It is ndt right that the general taxpayer should have to contribute this large sum annually for the benefit of the members of one section of the community who, when retirement comes, compete with him for his civilian- work. Superannuation benefits are much in excess of what should bo necessary after a person has been in steely employment, in most cases, at a good salary for many years. Let the benefits be reduced, the Government subsidy withdrawn, and the funds made self-supporting. This course would effect a saving of £-150,000 Government exepnditurc per annum.—l am, etc., Civilian.

[Our correspondent is in error in supposing that the Government annually contributes £454,000 to the support of the superannuation funds. The payments for the year to which he refers included a special payment of £IOO.OOO to the Public Service Fund.' In the following year the Government contributions totalled £409,420.—Ei1. O.D.T.]