MINORITY REPORT.

309

RCRA Lor Se

49. We consider it a fallacy to conclude that a high surplus
at a valuation means good administration and that a deficiency
provides a. primd facie case of bad administration. We think, on
the contrary, that in general the Society with the heavier
expenditure will be more likely to be actuated by the
“incentive,” as it is generally understood, than the Society in
which the expenditure is low. As an illustration : a Society
carrying the hazardous risks of the miners being in deficit at a
valuation would require to prove that its standard of administration
 was of a high order before it could make a claim upon the
Central Fund, whereas a Society composed of healthy lives could
afford to, and would, undoubtedly, be less strict upon its
members.

50. The only evidence of an incentive alleged to operate in a
direction consistent with the objects of the Act was given by
a representative of Employers’ Provident Funds, who claimed
that in order to reduce the expenditure on benefits the employers
sought to improve working conditions. (Lesser, Q. 13,375.)

VALUATION RESULTS.

51. The large surpluses and the disparities in those surpluses
have been referred to at length in the Majority Report, and
certain developments and modifications designed to reduce the
surpluses and to some extent the disparities are there recommended.


52. We are of the opinion that the effect of extending the
statutory benefits to absorb the moneys released by the new
actuarial basis recommended by the Actuarial Committee will
create a serious position for those Societies which, on the present
financial basis, have little or no surplus. The operation of the
Central Fund and the partial pooling of surpluses will probably
enable all Societies to continue to provide the normal rates of
benefits, but unless the equalising operations precede the valuation
 reports the position of certain Societies will still appear
quite hopeless. =~ We agree that ‘‘ mo Society and no type of
Society can claim a prescriptive right to a guaranteed existence,”
but we think it proper to say that the gradual decrease in the
membership of Societies below the average financial standard
will ultimately compel their decease and that the only Societies
which could afford to accept a transfer of engagements of such
a Society are the largest, which are just those where membership
 control can be least effective.
53. The emergence of surpluses and the consequent provision
of additional benefits have emphasised the weakness of the
system when viewed from the standpoint of the prevention and
cure of sickness. It will be obvious that a Society is only able
to provide additional benefits in proportion to the standard of
Ean

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