FINANCES OF FRIENDLY SOCIETIES.

Otago Witness, Issue 2170, 26 September 1895, Page 17

FINANCES OF FRIENDLY SOCIETIES.

{tfaoti Otm Own Oocrkspondbn'?.) Wki.ungtov, September 23. Mr Edmund Mason, the registrar of friendly societies, has submitted to the Government a scheme of friendly society fiuancial reform, based on the assumption of the concurrence and voluntary action of societies. The registrar Eoints oat that the greater sickness rate at the igher ages and the light mortality in New Zealand cannot fail to produce an increased total sickness after middle life. While the sickness benefit is continued throughout life it is probable that the rule which limits the benefits to members suffering from specific sickness will nob be strictly enforced, and this payment of old-age pensions cinder the guiie of sickness benefit is in England understood to account for a considerable part of the existing deficiencies. All societies should therefore remove this source of danger, while for those in regard to which the choice was between reconstruction and insolvency, the adoption of a fixed age at which benefits shall coco is necessary, and not only

necessary bub urgent, for those soeiotina whs have defied expert Advioe. The sacrifice In- | volved in any scheme of reconstruction increase! | year by year. Unless action be taken by tbj unßOund societiep, home members will receive their beiiefi's in full while others will huve to) go unsatisfied. R"conntiuc'iuu is urged in ordtv that all may bo fairly treated. There is no means of escape from the unpalatable fact tint all mufit thus accept a compromise. It is high time that societies should cease to enroll members where it ia certain that they will not be able to keep faith with them. It is culpable when a sociuty undertnt. oj a n<nv contract, after distinct proof hai bom afforded that it cannot possibly fulfil those already etijt.tng % The effect of the adoption of a fixed age at which the siekuess benefit and thi contribution shall cease will bo that in some s-wieties there will be a surplus, in others tolvenoy, and in the remainder a deficiency still, as to which last thera must be further action if they too are to become solvent. To tho«e societies which possess an available surplus such surplus should be devoted to an old «ge annuity, in connection with which the State might offer an old age flnnuity ><ot exceeding £26 per annum on liberal terms. One feature of reconstruction, it is contended, must be the abandonment of tbe flyatom of uniform contribution at all ages for new members. A graduated scale according to nge at admission must be adopted. The special danger which threatens email societies and brunches arising from the improbability of their experiencing au average rate of sickness l's dealt with, aud it iB pointed out that amalgamation of liability docs not necessarily involve centralisation of the funds. In the interest of progcofn and reform a diminishing rate of flick pay is conuYmred. It should be fixed »t a Kcalo that may bo made continuous under all conditions likely to arise. The nnce)7»tVTico or rt-joction of the scheme by ifce boc'u tics should separate them into two classee, tho-.e having adequate funds being specially certificated societies. TLojo accepting fcha sohc-tne ohculd submit their affairs to periodical investigation with actuarial certificates which would not bj a Government guarantee. Wtiile societies continue to manage their own affairs they must be eelf-relianb. With increased knowledge of New Zealaud vital statistics the time has come when it is possible to calculate tables of valuea fora sickness beucnt terminable at 60 to 65 years. The dinger of procrastination of reform actually increases, aud ia more apparent year by year. In the unsuund societies, an the young members realiio that they arc destined to brt the victims of fiir^ml error, the choice for them lies between financial reform or loss of savings, in part or all, whereby they seek to provide against the inevitable rainy day. "^