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5.
c)
Old-age allowance payable at 70, and an additional allowance payable as a supplement to Public Assistance as from 60 are already available to the elderly.
The implications of the figures in paragraph 3 are that the proposed scheme for sickness and premature death (I will come to retirement later) would cater for comparatively small numbers. For instance, though we have no cross reference between the numbers under 3b) on the one hand, and c) and d) on the other, the number of persons eligible for sickness benefit who were not already covered would clearly be smaller than the 35,000 in b), and of these an unspecified but significant number would merely receive under the contributory scheme what they would now receive under non-contributory Public Assistance. Since the former payments would be employment-related instead of need- related, Public Assistance might well be necessary in addition.
6. Administratively and actuarily a compulsory scheme would be infinitely preferable to a voluntary one, but:
a)
the Secretary for the Civil Service advises that if the Public Service, which is already fully covered, were compelled to contribute we would face very serious trouble, and I think he is right. Consequently it would have to be excluded. If the Public Service were excluded, we would have also either to exclude firms providing similar cover or allow them to contract out (as suggested by Heppell in chapter 8.9 of the Green Paper). But the exclusion of a sector amounting to at least a quarter of those eligible to join the scheme would create great problems when workers moved from the excluded to the included sector and vice versa. A by-product of this would be a tendency towards the immobilisation of labour. These problems could be mitigated by the proposals in chapter 8.8 of the Green Paper under which an employee could "freeze" his membership or withdraw from the scheme and receive back his contribution. But this would be very expensive actuarily, and in any case would be impossible under a compulsory scheme, and we fear extremely complicated and
/ administratively
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