Special Arrangements as to Arrears of Contributions. The industrial depression continued throughout the year to affect the arrears of insured persons in Wales, particularly those connected with the mining and allied industries. To meet this the normal period of grace was extended to the 31st December, 1927, in those cases where delay in payment of arrears was known to be due to unemployment. Even this concession did not fully meet the circumstances, as the Department received an abnormal number of applications for further extension from individual members and from Approved Societies on their behalf. An additional feature connected with this work was the introduction of a time limit for claiming free contributions. This condition seemed to have been imperfectly understood by many insured persons, who, by not surrendering the forms of application until they could also pay the balance of arrears, or by not otherwise appreciating the importance of surrendering the form within the prescribed period, rendered nugatory the concession specially intended for their benefit. As a result the Department had also to deal with numerous requests for permission to extend the period within which the applications for free contributions could be accepted. APPROVED SOCIETY STATISTICS. The numbers of Societies transacting business under the Acts in Wales remained unchanged, viz., 38 National Societies and 137 Societies approved by the National Health Insurance Joint Committee. The number of branches of Approved Societies operating in Wales fell, during the period under review, from 362 to 358, consequent upon the transfer of the engagements of four branches of the Independent Order of Oddfellows (Manchester Unity) Friendly Society. Membership Statistics. A statement showing the number of members of Approved Societies at the 31st December, 1927, inclusive of members serving in H.M. Forces, is given in Appendix XXV (page 289 below). Similar figures for each of the ten years to 1927 are given in Appendix XXVI (pages 290-1 below). BENEFITS. General. The issues of funds by the Department to Approved Societies to enable them to pay the ordinary and additional benefits to their members, and to defray their expenses of administration, amounted during the year 1927 to £1,467,393 10s. 1d., as compared with £1,653,620 18s. 9d., in the year 1926. The continuance of adverse economic conditions again resulted in a large number of inquiries from insured persons regarding title to benefit under the National Health Insurance Act. Considerable assistance has been rendered in reviving insurance under the National Health Insurance (Prolongation of Insurance) Act, 1921, and the Prolongation of Insurance Regulations, 1925, in connexion with claims for sickness benefit, and for pensions under the Contributory Pensions Act. Grants to Institutions. Grants to institutions for the purpose of providing certain benefits for members under the provisions of section 26 of the National Health Insurance Act, 1924, were made by 40 Societies during 1927. The total of such grants, viz., £9,224, was over 30 per cent. in excess of the corresponding total for 1926. In eleven of these cases the grants were nominal in amount, while in 35 cases the Societies concerned provide additional benefits out of surplus funds set free as a result of valuation. The grants in the case of these 35 Societies totalled £7,774. Amendment of Additional Benefit Schemes. Amendments of the schemes of additional benefits consequent upon the second (1922 and 1923) valuations were sanctioned during the period under review as follows: 7 58 65 1 2 3 (c) Amendment of additional benefit No. 19 schedule so as to permit of payment of the benefit to members who were unemployed during the strike period of 1926. (d) Reduction in the number of contributions to be credited under additional benefit No. 19 (partial remission of arrears). The general effect of the variations referred to under (a) above was to provide additional moneys for Dental Benefit (additional benefit No. 2) and Partial Remission of Arrears (additional benefit No. 19). Four cases involved a reduction in the rates of cash additional benefits, while in five cases a re-allocation of annual amounts was authorized in order to permit of a larger sum being spent during the earlier periods of the scheme with a corresponding reduction in later periods. Two branches of one Society amended their schemes so as to include additional benefit No. 8, viz., the provision of premises suitable for convalescent homes and the maintenance of such homes. The approved scheme for the administration of this benefit permits of a number of branches of the Society co-operating in the provision of one convalescent home, each branch being responsible for a proportion of the capital and maintenance charges and being entitled to accommodation on a membership capitation basis. AUDIT. The steady improvement in the audit results of Approved Societies and branches referred to in the report for the year ending March 1927, has not been maintained, as shown by the figures in respect of the year 1926 in the following comparative table :Percentage of Accounts certified free from Reservation. The increase in reservations is attributable chiefly to defects and omissions in the records as submitted for audit, to the failure of secretaries to notify promptly and accurately changes affecting membership status, and also to failure to comply with the various requirements of the schemes of additional benefits. Appropriate action is taken by the Department in all cases where weaknesses in administration are disclosed by the audit reports. A noticeable feature in connection with the audit results is the fact (illustrated below) that each year certain units whose accounts were previously certified free of reservation fail to maintain the standard, while other units improve. DEFICIENCIES ON ADMINISTRATION ACCOUNTS. The audited accounts for the year 1925, disclosed deficiencies in excess of 6d. per member as at the 31st December, 1924, in 41 Welsh units (39 of which were branches), an increase of 11 on the total for 1924. Levies were declared in five cases, while permission to dispense with a levy was granted by the Department in accordance with the terms of the Approved Societies Regulations, in 24 cases. Action regarding the deficiencies was suspended in two The accounts for the year 1926 have not yet been received in respect of 15 Societies and 74 branches. cases because the units had ceased to administer the Acts, and in the remaining 10 cases pending receipt of the certified accounts for the year 1926. The audited accounts for the year 1926, received during the period under review disclosed 25 units (22 of which are branches) with deficiencies in excess of 6d. per member at December, 1926. Appropriate action is being taken in these cases. SECURITY GIVEN BY APPROVED SOCIETIES. Appendix XXVII (page 292 below) shows the number of Societies operating in Wales which have given security under section 35 of the Act of 1924, and the form of such security. During the year under review one Society changed its form of security from Bond of Guarantee Society to membership of the Approved Societies (Officers) Guarantee Fund (Wales). Particulars are also given in the Appendix of reported cases of malversation, etc., of State Funds from the inception of the Acts to the 31st December, 1927. Three such cases, involving sums amounting to £169 7s. 4d., were notified during the year, none of which, however, fell to be paid out of the Guarantee Funds up to the close of the year. In addition two cases totalling £329 12s. 2d., which were outstanding at the 31st December, 1926, remained still uncleared at the 31st December, 1927. The balance standing to the credit of the Approved Societies (Officers) Guarantee Fund (Wales) at the 31st December, 1927, was approximately £5,661. AMENDMENTS OF RULES OF APPROVED SOCIETIES. During the period under review amendments of rules were sanctioned in the case of three Approved Societies enabling them to contribute out of the funds available for the administration of benefits, towards a scheme for providing superannuation allowances for their officers. The amount of the contribution is based on a fixed percentage of the officer's salary, the Society as well as the officer concerned contributing equal amounts. In addition, one Society amended its rules dispensing with general meetings of members and substituting therefor a delegate system of government. COLLECTION OF CONTRIBUTIONS OF PERSONS AGED 65 AND OVER. On and as from the 2nd January, 1928, in accordance with section 37 (2) of the Contributory Pensions Act, 1925, health insurance contributions ceased to be payable in respect of a person who has attained the age of 65. Sections 9 (1) (ii) and 39 (1) of that Act, however, impose on the employers of such persons the liability to pay special pensions and unemployment contributions no part of which may be deducted from the employee's wages. These special contributions are at the weekly rates of 9d. and 8d. for pensions and unemployment respectively for men, and 7d. for both purposes for women. Arrangements were agreed to with the Ministry of Labour whereby these special contributions are payable by the employer by means of separate stamps on a combined contribution card (Class P). This card contains provision for an appropriate declaration by the employer in cases where no unemployment contribution is payable on account of the employment being excepted from compulsory unemployment insurance. A register of insured persons of age 65 or upwards was compiled from (a) the records, held by Customs and Excise Officers, of persons aged 70 or upwards who were in receipt of old age pensions by virtue of the Contributory Pensions Act; (b) the claims for old age pensions at age 65 under the Contributory Pensions Act submitted to the Department; and (c) the Department's records of exempt persons. In this way appropriate cards (Class P (A) for men and Class P (E) for women) were issued by the Department during the period under review to over 33,000 persons (10,670 men and 136 women aged 70 or over, and 20,710 men and 1,780 women of age 65 to 70). In addition to the special P (A) and P (E) cards so issued by the Department appropriate emergency cards (Class P (X)) were made available at Post Offices for issue, on application, to employers and employees. At the request of the Ministry of Labour a form (Form X.687) was enclosed with the contribution cards issued to persons in the 65 to 70 age group, requesting submission to the Department of the current unemployment book or, if no unemployment book was held, information as to the nature of the employment. By the end of March, 1928, over 11,400 unemployment books, including 350 from persons age 70 or over, had been received and forwarded to the Ministry of Labour. In the bulk of the remaining cases the replies furnished on Form X.687 indicated that the persons were either unemployed or were engaged in an occupation which was excepted from compulsory unemployment insurancee.g., employment by way of agriculture, private domestic service or employment covered by a certificate of exception. Information relating to the above arrangements was issued to employers and employees by means of Memos. 308X, 309X and 310X. The new arrangements were well received, except by employees who did not wish to disclose their correct ages to their employers or by employers who did not appreciate the reason for such contributions. |