GOVERNMENT RAILWAYS SUPERANNUATION FUND REPORT OF BOARD

Appendix to the Journals of the House of Representatives, 1946 Session I, D-05

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1946 NEW ZEALAND

GOVERNMENT RAILWAYS SUPERANNUATION FUND REPORT OF BOARD

Laid before Parliament in pursuance of Section 124 of the Government Railways Act, 1926

The Board has the honour to transmit, for the information of Parliament, the following report upon the transactions of the Government Railways Superannuation Fund for the year enced 31st March, 1946. The Income and Expenditure Account, Balance-sheet and statements in connection therewith will be found appended. Amendments to Pensions. —On 7th December, 1945, the Superannuation Amendment Act, 1945, No. 47, was passed, taking effect as on and from Ist January, 1946. The main alterations to the Government Railways Act, 1926, are as follows : (1) The repeal of section 103 which made provision for a maximum retiringallowance of £3OO per annum (section 19 (2) ). (2) Pensions to be computed at one hundred and twentieth of the annual rate of pay for every year of service (section 19 (a) ), the rate of pay being the average rate of pay for the last five years of service (section 20). The pension arrived at above to be increased by an amount equal thereto, being not less than £3 15s. for each year of service or more than £3OO (section 19 (b) ). (3) Contributions to the Fund to be optional (section 22). (4) A contributor may cease to be a member and withdraw his contributions (section 23). (5) Increase in widows' pension from £3l to £52 per annum (section 28). (6) Extension of the age to which children's pensions are payable from fourteen years to sixteen years (section 29). (7) Increase in pension for members compulsorily retired. The pension to be computed on the basis as if the retirement had been on the grounds of being medically unfit (section 31). (8) Refund of surplus contributions held under the National Expenditure Adjustment Act, 1932 (section 32).

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(9) The minimum age at which a permanent employee may become a contributor to be twenty years (section 22). (10) Females may elect to become contributors (section 24). The expenditure for the year exceeded the income by £50,158. Members' Contributions.—The income under this heading showed an increase of £50,848. The number of contributors at 7 and 8 per cent, increased by 1 and 9 respectively, while contributors at 3, 4, 5, 6, and 10 per cent, decreased by 138, 1, 824, 77, and 3 respectively. Contingent Contributors.—During the year 105 casual employees elected to contribute to the fund so that in the event of their subsequently being permanently appointed they would not be faced with a liability in respect of service prior to permanent appointment. The total number of employees so contributing at the end of the year under review was 343, and the amount standing to their credit £14,556. Subsidy.—- I The sum of £238,951 was paid into the fund by the Working Railways Department, and the sum of £110,300 was received from the Treasury in accordance with the provisions of section 3 of the Finance Act, 1942, leaving a deficit of £50,158. Interest. —The interest earned amounted to £53,163, a decrease of £4,664 as compared with the previous year. Table D, Statement of Investments, shows that the average rate of interest on securities held at the 31st March, 1946, was 4-201 per cent., and the average rate earned on the mean funds for the year 4*772 per cent., as against 4*133 per cent, and 5*043' per cent, respectively for the previous year. Life Allotvances. —The expenditure on account of life allowances to members amounted to £606,239. The average of the 311 allowances granted during the year was £209 os. 3d., and the average of the 154 allowances discontinued was £l7B Is. 4d. Thirty-seven contributors have made elections in favour of dependants in accordance with the provisions of section 13 of the Finance Act (No. 2), 1940. Allowances to Widows and Children. —Previous to the passing of the Finance Act (No. 2), 1940, allowances to widows and children were paid only in cases where contributors died before retiring on a pension. Section 14 of this Act makes provision for payment of annuities to widows and children whether contributors die before or after becoming entitled to a retiring-allowance. The expenditure on account of allowances to widows and children was £58,796 —£33,649 to widows and children of contributors who died before retiring and £25,147 to widows and children of contributors who died after retirement. The sum of £29,533 was received from the Working Railways Account during the year on account of the increased payments to widows and children, as provided in section 114, Part 111, of the Government Railways Act, 1926. Cost-of-Living Bonus. —A cost-of-living bonus was granted to superannuitants payable from Ist October, 1943, at a maximum rate of £26 per annum, reducible £1 for £1 for income in excess of £335 per annum. The sum of £36,163 was paid during the year. The whole cost of this bonus is borne by the Working Railways Account. At the 31st March, 1946, there were 3,157 members, 1,409 widows, and 411 children, making a total of 4,977 persons actually on the fund, involving an annual liability of £653,184. R. Semple, Chairman, Government Railways Superannuation Fund Board.

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Table A. —Statement of Allowances for the Year ended 31st March, 1946

Particulars of Retiring and other Allowances discontinued during the Year

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— Section 102 : On Attainment of Retiring Age or for Length of Service. Section 111: Medically Unfit. Section 113: Widows. Number. Annual Amount. Number. Annual Amount. Number. Annual Amount Amount, at £52 per Annum. M. 1 F. Total. M. F. Total. Retiring and other allowances — Existing at beginning of year Granted during year at retirement Granted during year after retirement including increased life allowances Total Discontinued during year Existing at end of year 2,202 191 2,202 191 £ s. d. 482,295 6 3 46,095 9 0 2,684 0 0 797 120 1 798 120 £ s. d. 104,318 1 7 18,907 4 0 288 19 0 1,352 33 89 £ s. d. , f41,912 0 0 ' \ 28,392 0 0 1,716 0 0 ' 4,628 0 0 2,393 114 2,393 114 531,074 15 3 22,013 0 3 917 40 1 918 40 123,514 4 7 5,409 9 2 1,474 65 76,648 0 0 3,380 0 0 2,279 2,279 509,061 15 0 877 1 878 118,104 15 5 1,409 73,268 0 0 Section 113 : Children. il , at Total Retiring and other Allowances. Number. Annua Amount Number. Annual Amount. M. F. Total. £26 per Annum. M. F. Total. Retiring and other allowances — Existing at beginning of year .. Granted during year at retirement Granted during year after retirement, including increased life allowances Total Discontinued during year Existing at end of year 1(54 ; 74 8 143 68 8 307 142 16 £ s. d. 7,982 0 0 3,692 0 0 416 0 0 3,1 3 63 85 8 56 83 1,496 101 97 4,659 486 105 £ s. d. / 636,507 7 10 \ 28,392 0 0 70,410 13 0 8,016 19 0 246 29 219 25 465 54 12,090 0 0 1,404 0 0 3,5 1 1,694 90 5,250 273 743,326 19 10 32,206 9 5 217 194 411 10,686 0 0 3,373 1,604 4,977 711,120 10 5

Section 102 : On Attainment- of Retiring Age or for Length of Service. Section 111: Medically Unfit. Section 113: Widows. Number. Annual Number. Annual NumAnnual Amount M. F. Total. Amount. M. F. Total. Amount. ber. at £52 per Annum. How discontinued — By death By expiry 114 114 £ 22,013 s. d. 0 3 39 1 39 1 £ s. d. 5,384 15 2 24 14 0 46 19 £ s. d. 2,392 0 0 988 0 0 Total 114 114 22,013 0 3 40 40 5,409 9 2 65 3,380 0 0 Section 113 : Children. Total Retiring and other Allowances. Number. Annual Amount, at Number. Annual M. F. Total. £26 per Annum. M. F. Total. Amount. Hove discontinued — By death .. By expiry 29 25 54 £ s. 1,404' 0 d. 0 153 30 46 44 199 74 £ s. d. 29.789 15 5 2,416 14 0 Total 29 25 54 1,404 0 0 183 90 273 32,206 9 5

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Progress of Retiring and other Allowances since Establishment of the Fund to 31st March, 1946

Table B.—Statement of Contributors

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Section 102 : On Attainment of Retiring Age or for Length of Service. Section 111 : Medically Unfit. Section 113 : Widows. Number. Annual Number. Annual NumAnnual Amount, M. F. Total. Amount. M. F. Total. Amount. ber. at £52 per Annum. Total granted* t Total discontinued* 4,633 2,354 4,635 2,356 £ 843,678 334,616 s. d. 2 2 7 2 1,524 647 2 1 1,526 648 £ s. d. 188,653 3 3 70,548 7 10 2,137 728 £ s. d. 94,601 0 0 21,333 0 0 Total existing at 31st March, 1946 2,279 2,279 509,061 15 0 877 1 878 118,104 1! 5 5 1,409 73,268 0 0 Section 113 : Children. Total Retiring and other Allowances! — Number. Annual Amount, at Number. Annual M. F. Total. £26 per Annum. M. F. Total. Amount. Total granted*! Total discontinued* 1,225 1,008 1,189 995 2,414 2,003 £ s. 53,755 0 43,069 0 d. 0 0 7,382 4,009 3,330 1,726 10,712 5,735 £ s. d. 1,180,68? 5 5 469,566 15 0 Total existing at 31st March, 1940 217 194 411 10,686 0 0 3,373 1,604 4,977 711,120 10 5 Less amount receivable from the Working Railways Account 57,936 11 0 £653,183 19 :> * Total allowances granted and discontinued include 200 widows at £18 only, 463 at £31 only, and .693 children at £13 only, exeunt prior to increase of allowances, f These figures include 134 allowances totalling £15,620 lis. per annum granted under section 14, Finance Act, 1931. Of these allowances, 108 were, as provided for by section 27, Statutes Amendment Act, 1936, increased by £3,553 8s., and 97 existing at 31st March, 1945, as provided for by section 31 (1) of Superannuation Amendment Act, 1945, by £2,010 8s.

— 3 per Cent. 4 per Cent. 5 per Cent. 6 per Cent. 7 per Cent. 8 per Cent. 9 per Cent. 10 per Cent. Total. Contributors at commencement of year New contributors during year 372 1 15,355 461 1,556 64 450 34 167 20 83 5 34 1 18,018 • 585 Total Contributors discontinued during year Total contributors at 31st March, 1946 372 138 1 1 15,816 1,285 1,620 141 484 33 187 11 88 5 35 4 18,603 1,618 234 14,531 1,479 451 176 83 31 16,985

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Table C.—Progress of the Fund

Table D.—Statement of Investments

1946. 1945. Per Cent. Per Cent. Average rate of interest on securities held at 31st March . . 4-201 4-133 Average rate of interest earned on the mean funds, including reimbursements made by the Treasury in respect of reduction of interest . . .. .. .. 4-772 5-043

Balance forward. Allowances granted, £ s. d. £ s. d. 1903 to 1935 658,575 16 5 1936 1,246,984 7 11 14,637 7 0 1937 1,250,860 10 2 13,863 2 0 1937 (increased allowances, section 27, Statutes Amendment Act, 1936) 3,553 8 0 1938 1,272,724 7 5 24,622 14 0 1939 1,282,354 0 2 36,872 9 0 1940 1,279,836 2 8 51,808 12 0 1941 1,248,383 2 2 58,157 10 0 1942 1,187,537 1 10 47,033 1 0 1943 1,164,045 0 0 27,466 4 0 1944 1,151,546 6 9 66,188 14 0 1945 1,130,936 6 0 71,088 16 0 1946 1,080,778 12 11 70,410 13 0 1946 (increased allowances, Superannuation Amendment Act, 1945) 36,408 19 0 1,180,687 5 5 Less members died, &c. 469,566 15 0 Less liability of Working Railways Account 57,936 11 0 527,503 6 0 Annual liability at 31st March, 1946 £653,183 19 5

Funds invested at 31st March. 1946. 1945. £ s. d. £ s. d. At 3 per cent. 46,425 0 0 46,425 0 0 „ 3-25 „ 1,700 0 0 i,700 0 0 „ 3-375 „ 25,000 0 0 25,000 0 0 „ 3-5 „ 152,646 14 4 158,936 18 9 „ 4 „ 212,070 10 0 212,070 10 0 „ 4-25 „ 400,753 13 5 332,193 18 5 „ 4-4 „ 335 0 0 335 0 0 „ 4-5 111,992 10 11 216,321 12 8 „ 4-75 „ .... 869 5 9 1,008 18 11 „ 5 „ 76,752 8 10 93,099 13 2 „ 6 „ 1,316 8 4 1,389 11 8 Cash in hand 9,119 2 1 14,870 11 11 1,038,980 13 8 1,103,351 15 6

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Statement oe Accounts Revenue Account for the Year ended 31st March, 1946 Expenditure £ Income £ Retiring-allowances to members .. .. .. .. 606,239 Members'contributions .. .. .. .. 285,771 Allowances to widows and children .. .. .. 58,795 Members'contributions on account of casual service .. 42,337 Cost-of-living bonus .. .. .. .. .. 36,163 Fines . . . . . . . . . . 307 Refund of total contributions .. .. .. .. 72,849 Subsidies— Refund of contributions in excess of allowances drawn by From Consolidated Fund (section 3, Finance Act (No. 2), 1942) 110,300 deceased beneficiaries .. .. .. .. 906 From Working Railways Account (section 119, £ Transfers to other funds .. .. .. .. 1,935 Government Railways Act, 1926) .. .. 170,000 War-damage insurance .. .. .. .. .. 68 From Working Railways Account: Increased Part-cost actuarial investigation of the Fund .. .. 296 allowances to annuitants compulsorily retired Administration charges— (section 27, Statutes Amendment Act, 1936, Travelling-expenses of Board members .. .. .. 80 and section 31, Superannuation Amendment Public Trust commission .. .. .. .. 1,017 Act, 1945).. .. .. .. .. 3,255 Audit fee .. .. . . .. .. .. 50 From Working Railways Account: Increased Salaries .. .. .. .. .. .. 1,942 allowances to widows and children (section 114, Postages .. .. .. .. .. .. 621 Government Railways Act, 1926) . . r .. 29,533 Printing and stationery . . .. .. .. 132 From Working Railways Account: Cost-of-living bonus . . . . .. .. .. 36,163 — 238,951 New Zealand Railway Tradesmen's Association .. . . 12 New Zealand Engine-drivers, Firemen, and Cleaners' Association .. .. . . . . .. 17 Amalgamated Society of Railway Servants .. .. 10 New Zealand Railway Officers' Institute .. .. 12 Interest— Investments .. . . .. .. 44,688 Treasury Department.. .. .. .. 8,474 53,162 Commission on Government Life Insurance collections .. 56 Balance carried down, being excess of expenditure over income for the year .. .. .. .. . . 50,158 £781,093 £781,093 £ _ £ Balance brought down .. .. .. .. .. 50,158 Accumulated funds brought forward on Ist April .. .. 1,130,936 Balance, accumulated funds as at 31st March .. .. 1,080,778 £1,130,936 £1,130,936

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Balance- sheet as at 31st March, 19A6 Liabilities £ j Assets Accumulated funds, as per Revenue Account .. .. 1,080,778 Investment Account— £ £ Casual employees' contingent contributions .. .. 14,556 i Investments .. .. .. 1,029,862 Retiring and other allowances due (not paid)— ' ! Cash in hand . . . . . . 9,119 Members .. .. .. .. .. .. 352 1,038,981 Widows and children .. .. . . .. . . 573 j Current Account— Refund of contributions authorized (not paid) .. .. 10,693 ! Cash in hand .. .. .. .. .. 24,492 Refund of contributions in excess of allowances drawn by ! Contributions and fines in transit .. .. .. 10,826 beneficiaries (not paid) .. .. .. .. 346 Contributions due by Army, Navy, and Air Force Departments 11,596 Transfers to other funds authorized (not paid) .. .. 110 ' Contributions outstanding .. .. .. .. 1,915 Interest paid in advance .. .. .. .. 99 Contributions due by members in respect of casual service .. 25,979 Public Trustee .. .. . . . . .. 378 : Working Railways— Reserve for bad and doubtful debts . . . . . . 3,000 i On account of increased allowances to annuitants (section . Rebates of contributions (National Expenditure Adjustment I 27, Statutes Amendment Act, 1936, and section 31, Act, 1932) .. .. .. .. .. .. 32,625 I Superannuation Amendment, Act, 1945) .. .. 396 Sundry creditors .. .. .. .. .. 75 On account of cost-of-living Bonus .. .. .. 2,887 On account of additional allowances to widows and children (section 114, Government Railways Act, 1926) . . 4,391 Interest due not paid . . . . .. .. .. 6,292 Interest accrued but not due .. .. .. .. 10,486 Subsidy in transit .. .. .. .. .. 5,300 Sundry debtors .. .. .. .. . . 44 £1,143,585 £1,143,585 R. Semple, F. H. McAuley, A.R.A.N.Z., Chairman of the Government Railways Chief Accountant, New Zealand Railways. Superannuation Fund Board. I hereby certify that the Revenue Account and Balance-sheet have been duly examined and compared with the relative books and documents submitted for audit, and correctly state the position as disclosed thereby.— J. P. Rutherford, Controller and Auditor-General.

By Authority: E. V. Paul, Government Printer, Wellington.— 1946. Price 6d.]

Approximate Cost of Paper.—Preparation, not given : printing (1,050 copies), £26

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