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APPENDIX III.

Report of Pensions Committee on the question of adopting in Crown Colonies and Protectorates the principle of the Superannuation Act, 1909.

In connection with the Draft Treasury Rules to provide for the apportionment of pensions for mixed service, which have been brought before the Pensions Committee, the question of applying the principle of the Superannuation Act of 1909 to the Colonies has arisen, and the Committee decided that before proceeding further with the consideration of a draft model Ordinance it is desirable to obtain a decision upon the principle of such application.

It will be well to record here quite briefly the principle of the new Act. Instead of a pension on final retirement taken at one-sixtieth of the salary at the date of retirement, with no other form of benefit attached to service under the Crown, the new Act substitutes a pension of one-eightieth of the salary at date of retirement for each year of service, combined with a gratuity payable on retirement equal to one-thirtieth of the salary for each year of service, subject to the limit that the gratuity shall not exceed one and a half times the salary, with a further proviso as to reducing the amount of Bat the Act farther provides-and this is the great gratuity if the officer serves after the age of 65. advantage which is claimed for it-(1) that, if an officer dies in the service after not less than five years' service, his legal representatives may receive a gratuity equal to his annual salary (with some deduction if he is over 65 at the date of death); (2) that, if he dies a short time after his retirement, his legal representatives may be given a gratuity equal to the difference between his annual salary and the total amount received by way of pension and gratuity if such amount is less than his annual salary.

The new Act was adopted in this country after two plebiscites of the Civil Service, and the option given to the existing Civil Servants to come under it has been taken advantage of by a very large percentage of the service.

It would be impracticable in the case of the Crown Colonies to carry through a similar referendum, but, as Colonial Pension Laws are based upon the principles of the Acts in force in this country previous to 1909, it might not be unreasonable, if it were thought desirable, to adopt the principle of the new Act without consulting the Colonies.

The Treasury have more or less satisfied themselves that the system of the new Act will not cost the tax-payer more than the previous pension system, and it might be argued that, before adopting the above proposals for the Crown Colonies, the Secretary of State should be satisfied that Colonial revenues will not suffer financially. This would require elaborate actuarial investigations for each Colony, and in many Colonies the necessary material for such calculations might take years to collect. On the other hand it should be Moreover the results might be different in almost every case. remembered that when the tropical Colonies were given pensions on a higher scale than the Home service the policy was adopted without any actuarial calculation as to the financial effect, presumably on the ground that officers serving in such climates deserved higher pensions.

A good deal might be said, particularly as regards service in West Africa, in favour of an arrange- ment whereby some immediate gratuity would be payable to the widow of an officer who dies early, but in several of the Colonies this principle of a benefit to an officer's dependents, which was probably the main attraction of the new Act in the United Kingdom, has already been met to some extent by Widows' and Orphans' Pension schemes, and the Committee see no reason why similar schemes should not be gradually extended to others of the Crown Colonies.

Further, it does not follow that because the principle of the Act has been found to suit the circumstances of the majority of Civil Servants in this country it would also commend itself to the majority of Civil Servants in the Crown Colonies. Speaking generally, the men who go out from this country as officers to the Crown Colonies are men who would not be specially attracted by the idea of insurance combined with a lower pension. The junior members of the service are to a large extent persons born in the Colonies who are sufficiently provided for under the present system.

Moreover, the Committee are of opinion that the rates of pension usually earned by officers appointed in this country to the Colonial service are already so low that it is undesirable to reduce an officer's pension by converting a portion of it into a gratuity which he might lose in some unprofitable business or speculation. Though, therefore, the gratuity might be useful in some cases, it is, in the opinion of the Committee, more important in the vast majority of cases to keep the rate of pension as high as possible.

There remains the very serious question of the complications and delays which would arise out of any attempt to adapt the principles of the Act of 1909 to a number of Colonies under widely varying conditions. It is one thing to adopt this system in a uniform service like that in this country, but quite another to adapt it to a number of divergent pension systems. It is already difficult to obtain any degree of uniformity in pension regulations in the Crown Colonies, and under the new system it would be almost impossible, while the delays and uncertainties of calculation might prove

serious.

The Committee therefore recommend that the principles of the Act of 1909 be not adopted in the Crown Colonies and Protectorates.

H. BERTRAM Cox,

C. ALEXANDER HARRIS. GEORGE W. JOHNSON.

J. 8. RISLEY.

JOHN ANDERSON,

Secretary.

20th December, 1910.

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