THE GOVERNMENT LIFE INSURANCE ASSOCIATION.

Timaru Herald, Volume XLIII, Issue 3605, 20 April 1886, Page 3

THE GOVERNMENT LIFE INSURANCE ASSOCIATION.

TO THE. EDITOR OF THB TIJIARCT HERALD. J Siu, — A Press Association telegram which appears m the Daily Times this morning , informs us that the Central Board at Wei- j lington havo committed official suicide, and have passed a resolution proclaiming to tho world that they aro no longer capable of managing the affairs of tho institution, and ! that therefore tho management Bhould be ' taken away from tho control of the policy- ' holders, nnd bo handed back to the Govorn- ' ment! Truly a curious scqvilur. Because ' tho existing Board have proved incompetent, ' to put it mildly, the institution is to be handed ' back to the tender mercies of the Government ! The real truth is that the policy-holders have not yet had any fair and honeßt control, but : they were on the point of getting it, by means of Parliamentary intervention ; and it is this knowledge which has given the present Board such a severe and sudden fright. Following tho tactics adopted; by a well-known member of tho animal kingdom when it sees a coining danger which it cannot avert, "tho Board have turned and stung themselyes to death. But that should not m any effective degreo prevent us getting a ■wholly elective Board, or a Board m whioh the elective olerocnt shall largely predominate. Tho Government do not rcquiro representative protection on the Board, for, better than representative protection, we have given them a cash protection by deciding by resolution of tlio Board that not less than two-fifths of the entire net aßscts of the Association shall bo invested m Government securities. At the present time wo go very much beyond that, for at this moment, out of 'surplus funds to the amount of a little over £1,000,000, "we have about £650,000 (I cannot quote exact amount) invested m Government securities at 4i and 5 per cent. This rate of interest is much too low to yield any adequate bonus to tho policy-bolder, who will fully appreciate what tins low rate of interest means when it ia pointed out that a difference of 1 per cent on ourinvested funds, compounded on a 5 per cent basis for tho quinquennium, mcana a loss to tho policy-holders of from £56,000 to £60,000. This £56,000 or £60,000 should be distributed amongst them m the form of bonus, instead of which it goes to the Government. You will thus see that tlie Government nro amply protected by tho cash investment m Government securities of two fifths of the Association's funds, which means a ca3h deposit of £380,000 out of every £1 ,000,000, and Eoiu proportion to every part of a million. What tho policy-holders desire after timt is to bo allowed to carry on their own business on a hard business basis, relieved from the withering influence of Government control. 1 am very glad to find that Mr Shannon m my absenco has taken up such a firm stand on behalf of the policy-holders. It was understood between us that ho should do his best to protect tho policy-holders m my ab-cnee, for I hnve for v long time paat ceased to look to my fellow-elected directors, Messrs Graham and Bell, for any support 03 UKainst tho prejudicial influences of Sir Julius Yogel. I am travellina for change of sconp, and for tho purjioso of noting tho political feeling of tho people of the country previous to tho beginning of the session, but I scarcely think I should have been absent from Wellington if I had lmd the least idea that Sir Julius Yogel und his satellites intended to spring such a Burpriso upon us. 1 am, &c, Gkohgu Fisimn. Dunodin, April 17th.