The Daily Times THE OLDEST MANAWATU JOURNAL ESTABLISHED 1875. MONDAY, DEC. 18, 1884.

Manawatu Times, Volume X, Issue 1366, 8 December 1884, Page 2

The Daily Times THE OLDEST MANAWATU JOURNAL ESTABLISHED 1875. MONDAY, DEC. 18, 1884.

The new system of management of Government Life Insurance affairs hy a Board consisting of members partly nominated by Government and partly elected by policy-holder? which is about jbo he tried, has paused attention to be generally directed to the affairs of that State institution. The question of whj Government should engage la. Insurance business iat all has never been satisfactorily answered. If it is justified m un«i dertakin^ Life assurance, or if any necessity for it doing so exists, then the B-ime argnments maj be used to warrant it m undertakirg Fire or Marine insurance. Insurance is m itself a desirable thing, and if no other means ot effecting it were Available than Government might fairly be expected to undertake the adntyoi providing facilities f^r [ii. .But m New Zealand we have a large number of companies competing m his direction, some of which offer greater facilities than Government; There are only two arguments which: can be used with any weight m faror of Government undertaking such business. The first of these is th\t insurers have the benefit of payment being guaranteed by the State, and tho second that the State should undertake the work not to make a profit out of the public bat to enable all eligible to insure at the lowest rates consistent with safety. Now, m regard to the first, if the State has to step m to provide a guarantee to insurers it necessarily implies that companies previously doing business »re not established on sound basea. If this is the case Government does not carry out the whole of its duty, lot under such circumstances it should prohibit all others ftom taking risks. If thej I are . not sound they are frauds upon the public ; if they are capable of meeting their engagements then there ia no necegaiity for the State to step m with itsjgtiarantee, especiallj as the very fact of having to compete with an institution with the State at its back should make the private companies still less able to carry on business at a profit. In regard to the second argument, if it is to be be effective it must be shown that there is a wide difference between the premiuns charged by Govern* ment and those charged by private companies— that Government rates must be vsry much lower. Undoubtedly they should be lower, for by using other parts of ins State

machinery without extra cost (to-« 1 vernment should be able to work cheaper than private companies. But does such a difference exist ? JMot only is there no appreciable difference m the tables of Crovern^ merit as compared with those of most companies, but some are actually insuring at much lower rates. With the advantages it possesses of advertising ab httle or no cost m public documents, m railway Stations, post offices, &c, and of ; saving cost ot collection by forcing J postmasters to act as collectors without remuneration, Government should have beon able to drive all competitors out of the field. But companies contir u® •to flourish m New Zealand, and the only real usu of the department appears to have beento provide occupation and^alavies fora large staff of officials. The Department has not benefited one single individual from the daj the first premium was taken up to the present time. It has placed no facilities m ; the way of insurers which werendt obtainable elsewhere )• it haß saved, no money to insurers ; and its guarantee is no better thair that of any of the old established' companies. Under its system Of I management it. has been possible for men to draw princely sala-v ries, and at the same time poor men have been forced to allow policies to lapse after they have paid premiums for a number of years. It has grovelled m the very depths of meanness to endeavor to secure custom which would , have come naturally had the Department been able, as it should, to offer bete ter inducements than private com> panics. Wa do not believe m the State undertaking any business which can be carried on equally well by private enterprise. The creation of a State .Insurance Department was the putting into practical ■ shapesimilar ideas to those which subsequently aimed at National Assurance and destroying friendly Societies, and we trust thie time is not far distant when the State will dis« pose of its right; title, and interest m an institution which, since the day of itg.inception, has only served to fatten a host of officials.