MR SAVAGE AND A PROMISE

Southland Times, Issue 23497, 2 May 1938, Page 8

MR SAVAGE AND A PROMISE

Effect Of Security

Plan

EXPLANATION OF STATEMENT (Special to The Times) WELLINGTON, April 30. A recent promise by the IJrime Minister (the Rt. Hon. M. J. Savage), that no one, by the Government’s social security proposals, would be placed in a worse position than he was in at present, and that the rights of superannuitants and contributors under the present schemes would be safeguarded, was recalled by Mr H. P. Mourant, secretary of the New Zealand Bank Officers’ Guild, during the crossexamination, which followed the submission of bank officers’ views to the Parliamentary Committee on National Health and State Superannuation yesterday.

“Yes, that is quite right,” said Mr Savage, when reminded of his assurance, “but I did not say that they would be exempt from taxation. What I was referring to was the undesirability of closing up existing funds and making people feel that they, had been dragged into something' else. The cross-examination occupied about two hours. “You are aware, of course,’ said the Prime Minister, to Mr H. E. Evans, counsel for the Associated Banks, “that under the Government’s proposals widows, old-age pensioners, invalids and miners, as well as various forms of health services, will be covered in the expenditure. The bulk of it will be going to services other than superannuation. Would you say the bank officials . have not the same' liability as other members of the community?” Mr Evans: That is a matter of how far taxation will go into this national fund. If there is to be taxation the bank officers will pay their share. Mr Savage: We are collecting say 1/- in the £1 on income. Well, now, if two-thirds of that 1/-, or more than two-thirds, went into services other than superannuation, it looks to me that the bank official would have the same responsibility as anyone else.— Yes, sir, if you look at it in the light of taxation. <■' “NOT THE LAST WORD” “There is another phase of it,” said Mr Savage. “I suppose the bank officials will admit that they have some responsibility to their parents, who may be getting benefits under the Government scheme. Of course, I don’t suggest that the proposed method of taxation is the last word or anything like that. I just want to speak in a general way about the thing. It is a matter of hammering out the best method of doing it. We claim, of course, the right to impose taxation in any form upon all sections of the community for a common purpose. We want to make it as equitable as we can, anJ I don’t suggest for a moment that the 1/- in the £1 method is the most equitable method of taxation, but it is the one that is handiest for the time being. Here we are told’that bank officials have no liability and, therefore, should not contribute. Public servants would naturally say the same thing. All people who had taken out any kind of insurance would be entitled to make the same claim. Do you think it would be right for the Government to accept that position?” ’ Mr Evans: If superannuation is treated as a thing apart, our submission is that only those who benefit ; should contribute. As far as the other services are concerned, it is submitted ' that the proper basis for them is ; taxation.

Mr Savage: You would agree that if it could be shown that two-thirds or any percentage of the proposed expenditure was to go in services other than actual superannuation, the bank officers would claim no exemption from that?—That is for Mr Mourant to say. I rather imagine that the figure would not be two-thirds.;

“I think it is more than that,” said Mr Savage. “I would not split straws about it, though. I take it there is no health provision 'in the superannuation scheme of the various banks. I don’t think there is any private institution on earth that can provide the benefits that are provided in the proposals of the Government. V. T e won’t argue about that, but the thing that did strike me most was the declaration that the bank officials were getting no benefit from this at all, whereas I claim they will get at least two-thirds of the benefits provided under our scheme. “Boiling it all down,” added Mr Savage, “you would agree that the only legitimate claim that the bank officials would have at all would be to exemption from superannuation.” SPLITTING UP SHILLING The Minister of Finance (the Hon. W. Nash): Is the only claim that the bank officials make that they should be exempt from the provisions as far as any cost associated with superannuation is concerned? Mr Evans: That is so. Mr Mourant said that their suggestion was that the shilling should be split up—so*'much for superannuation and so much for health. The Government seemed to have assumed that everybody would pay 1/- and that unless everybody paid 1/- the scheme could not be financed. Mr Nash said that the pensions would be paid according to the needs of the people. All the other benefits, except superannuation, would be universal. Mr S. G. Holland (Opposition, Christchurch North), said that in 1937 the Prime Minister had stated:

“Our job is to make superannuation universal and to see every person in New Zealand is covered. Those who are contributing to existing funds will have the option of coming into the State scheme voluntarily if they wish to do so, but there will be no compulsion in their case.” Mr Savage: I say that now. Mr Holland (to Mr Mourant): You didn’t think you would have to pay if you did not come in?—No. Mr Savage: If this was made a charge on the Consolidated Fund would you still oppose?

Mr Mourant: On principle, yes. Mr Savage: Thirty shillings a week is too much for an old-age pensioner? Mr. Holland: Would you say, Mr Mourant, that it has come as a great shock to the members of the Bank Officers’ Guild to learn from the Prime Minister this morning that, although you will find yourself outside the benefits of the scheme because you have made provision for your own old age, you will find yourself inside the scheme in that you will have to contribute toward the cost?—Yes, in view of the Prime Minister’s statement.

In replying to Mr Savage, Mr Mourant said they had not objected when the old age pension was raised to 22/6 a week. They were not objecting to it going up to 30/-. It was the method of raising the money to which they were objecting.