Page 32 - Group Insurance and Retirement Benefit IC 83 E- Book

restricted to schemes certified to be, on the whole, not less favorable than the unified

scheme; but, even so, the full advantage of unification would not be felt for a further 40
years. Nevertheless, a large step towards uniformity would have been taken, and there

would be an immediate gain in simplicity and economy of administration.
8. Under the 1937 Act, each authority (including a local-Act authority) is responsible for

the solvency of its own superannuation fund. A unified scheme could lead to simplified
financial arrangements, e.g. an unfunded scheme—which most actuaries would probably

deprecate—or a single fund for all authorities.

9. The question of a single fund was considered by the Norman Committee in their report
On the Superannuation of Persons employed by Local Authorities in England and Wales

(Cmd, 329 of 1919). Paragraph 73 of that report said that ' this plan has much to

commend it inasmuch as it unites the advantage of the freest opportunities of interchange
between the various staffs, the averaging of all risks, and the smallest aggregate amount

of administrative work'. The proposal was rejected because (paragraph 74) 'the solvency
of the fund would be at the mercy of the separate action' of the independent authorities, as

regards conditions of service and scales of pay, "without their having individually more
than an indirect and remote responsibility for it'. Since 1919, however, conditions of

service and scales of pay in local government employment have, to a large degree, been

standardized, and the above objections have now lost some of their former force.
10. The advantages of a unified fund may be summarized as follows.

(1) Uniformity of benefits, both by reason of the standardized scheme and also since
there would be fewer variations of practice. (Certain discretionary powers, such as the

addition of years for purposes of calculation of benefits, might well continue, but any
excess cost thereby is a charge to the general rate account and not to the superannuation

fund.)

(2) Simplicity and economy of administration, including the disappearance of transfer
values.

(3) Possibility of unified valuation, with simplified allocation to authorities (e.g. on basis

of salary rolls or rateable values—although both are objectionable in certain respects).
(4) Spreading of actuarial risks, with possible advantage to smaller authorities.