H.—l

2

Rebates of Soldiee Contributions. In accordance with instructions I issued the following circular to all societies : — " Friendly Societies Department, Wellington, 17th December, 1918. "To the "Dear Sir, — " I am directed by the Hon. the Minister to advise that the Government has made provision for assistance to the Sick and Funeral Funds of friendly societies in connection with the extra liabilities imposed upon those funds through the remission of contributions due to military service. " The contributions payable by members to the Sick and Funeral Fund are to be claimed for the full period of service as on Form F.S.C. (1), and in accordance with the instructions in F.S.C. (2). " The net amount of the contributions due to the Sick and Funeral Funds, after assessment by the Actuary in respect of the adjusted sickness and mortality liability of these members, will be credited to the trustees of the society or district. " I am sending under separate cover a supply of claim forms (F.S.C. 1) and instructions (F.S.C. 2) — one each of the latter to be sent by you, with as many claim forms as are necessary, to each branch. " It is requested that claims for this grant should be compiled as urgently as possible, and returned to you for transmission to the Department without delay. " I am, &c, " R. E. Hayes, Registrar." Up to the 31st March, 1919,. claims amounting to £10,117 had been met. A further sum of £25,000 is estimated to be required during the current year to settle all claims up to dates of discharge of soldier members. After-discharge Sickness. A definite method of dealing with this war problem having been adopted by the Government, the following circular was sent to societies: — " Friendly Societies Department, Wellington, 2nd June, 1919. " For the, Information of Society and Branch Secretaries. " I am directed by the Hon. the Minister in Charge to advise you of the arrangements authorized by the Government in respect of the sickness of members of friendly societies after discharge from the New Zealand Expeditionary Force. " For the purpose of ascertaining the actual experience of this sickness, each society will require to establish a fund called the ' After-discharge Sickness Fund.' The income of this fund will consist of amounts representing the sick-contribution reserve held on account of these members in the respective Sick Funds ; such amounts, at rates fixed by the Actuary, to be transferred from the society or branch. Sick and Funeral Funds to the society's ' After-discharge Sickness Fund.' The member will continue to pay his usual contribution as at the present rate. " Out of the ' After-discharge Sickness Fund ' is to be paid all the sickness of all discharged soldier members, whether such sickness can be attributed to war causes or not. Every soldier member, therefore, from the date'pf his discharge is to be reinsured in the ' After-discharge Sickness Fund ' for his future sickness. This will have the effect of determining the amount, if any, of excess sickness due to war causes in the discharged soldiers' experience as a group and apart from the normal sickness of the other members. On the yearly ascertainment of this excess sickness, if any, the Government will pay into the society's ' After-discharge Sickness Fund ' half the amount of such excess, the remaining half to be made good by levy on the whole of the members of the society. " It is important that each society should take immediate steps, and advise its branches, to keep the sickness claims, including those already paid, of all discharged soldiers, as explained above, in a separate account, apart from the sickness of non-soldier members, in order that the first-mentioned claims may be charged to the 'After-discharge Sickness Fund.' " Societies with a membership of less than 400 will, for the above purposes, require either to attach themselves to the nearest society or district of their order, or to reinsure along with other small societies in an ' After-discharge Sickness Fund ' to be established by, and under the direct control of, the Registrar of Friendly Societies. " I will notify later as to the registration of the necessary rule giving authority for the establishment of the fund, the rates of contributions to be transferred, and the general conditions. " R. E. Hayes, Registrar." The Department is now preparing lists of soldier members from the returns sent in by societies relative to death reinsurances and contribution refunds. It is hoped that societies will, as soon as they receive the necessaryfjforms, &c, take steps to establish the system, which, apart from the subsidy question, will much 'facilitate the jcompilation of future valuation reports in respect of sickness experience. Audit. I have previously drawn attention to the inadequate methods of audit in many societies, and to the fact that the legal provisions in this respect remain as when established in 1880. In order