110

MAJORITY REPORT.

SE

ployers and supported to a substantial extent at the cost of the
taxpayer, we concur in the view that the responsible department
of the Central Government must be armed with adequate powers
to insist on a proper standard of administration and to take
effective action where any Approved Society falls short of
administrative efficiency in any respect.
239. We feel that withdrawal of approval, though an appropriate
 weapon for grave disorders is too drastic a remedy
for minor irregularities and that, moreover, it involves a procedure
 which may appear somewhat too formal where great
issues are not at stake. We are also informed that the
application of the penal provisions of the Friendly Societies Acts,
to which reference has been made above has proved ineffective
by reason of the fact that it involves proceedings in a court of
summary jurisdiction, a course which the Department will
always hesitate to take except in extreme cases (Kinnear 23,496).
We have carefully considered what powers might appropriately
be given to the Department to enable it to deal effectively with
defective, methods of administration on the part of an Approved
Society where the alleged defect is not of so serious a character
as to warrant a charge of general maladministration. The first
type of case which may be considered is that of a Society whose
rules contain some provision prejudicial to the interests of the
members or inconsistent with sound administration and which
refuses to make the necessary amendment of its rules. There
are also cases where the rules, being based on the original Act
of 1911, and having undergone no subsequent amendment, cannot
 fail to mislead the members. We were informed that when
in 1912 Societies were being granted approval at the rate of some
hundreds a week, it was impossible for the examination of their
rules to be undertaken with the full care and attention that was
desirable and that as a result some unsatisfactory provisions were
passed by inadvertence. Moreover it is to be remembered that
the examination of rules in 1912 was carried through at a time
when there was as yet no experience of the operation of the
Act, ‘and that the desirability of amendment may only have
become apparent in the light of later events. It appears that
a few Societies persist in taking advantage of this position and
refuse to give effect to the suggestions which have been made by
the Department for the repeal or amendment of the rules in
question. And as things are at present, when rules have once
been sanctioned, the Minister has no power, apart from the
exercise of tactful persuasion, to secure a subsequent amendment
 even when later legislation may have rendered certain
rules wholly inoperative.

AMENDMENT oF RULES.

240. We consider that provision should be made in the Act to
empower the Minister, in any case in which the rules of a Society