Another great error in the constitution of 'benefit societies is in making them for a year only. These yearly societies are to be found in almost every colliery in the n. of England, and are popular among the less intelligent of the people. The objects are gen erally a fund for sickness and funeral expenses, a deposit fund, and sometimes a loan bank. Towards the first, there-is perhaps a weekly payment of twopence or threepence, together with the interest arising from the loan of money to the members. Towards the deposit fund there is a payment ranging generally from sixpence to two shillings, the accumulations being received back when the society closes. The money deposited b is employed in to such of the members as desire such accommodation, within the amount of their several entire deposits for the year, one penny per pound per month being charged by way of interest. The surplus, if any, of the twopences and interest, after sick and funeral money, books, and other necessaries are paid, is divided amongst these members who may be clear of the books at the close of the soci ety. In some instances, only three fourths of the funds arc divided, and the members commence another year with the balance; but this only happens when they are all in good health. Nothing of the kind would occur if one or more of the number were likely to suffer more than the ordinary rate of sickness. Then the healthy members join other societies, and leave the sick to take care of themselves. In any case, they are so left at the end of the year as no society will receive them. Yearly societies are, indeed, in every point of view a most objectionable class of institutions, to which working-people would never resort except through ignorance.
A well-constituted friendly society involves, in the first place, the principle of pay ments appropriate to particular ages, as no other plan can be considered equitable. It stands forth before the working-classes as a permanent institution, like the life-aSsurance societies of the middle and upper classes, and necessarily reqidres its members to con sider the connection they form with it as an enduring one, because its grand aim is expressly to make provision, at one period of life, for contingencies which may arise at another—for youth, in short, to endow old age. By a yearly society, a man is left at last no better than he was at first, as far as that society is concerned; but the proper friendly society contemplates his enjoying a comfortable and independent old age, from the results of his own well-bestowed earnings.
It is•essential to the character of a proper benefit society that individuals be not admitted indiscriminately. To take a person in bad health, or of broken constitution, is unjust to those members who are healthy, because he is obviously more likely to be a speedy burden upon the funds. Here. as in life-assurance societies, it is necessary to admit Members only upon their showing that they are of sound constitution and in good health, And it may be well to grant no benefits until after the member has been a year in the society. By these means, men are induced to enter*when they are hale and well, instead of postponing the step until they have a pressing need for assistance, when their endeavor to get into a benefit society becomes little else than a fraud.
Under the sanction of government, tables have been formed by Mr. John Tidd Pratt, late registrar of P. S., in England, and by Dr. Farr, the actuary of the Eng lish registrar-general. The former, together with useful instructions in the book keeping of F. S. are embodied in the reports by Mr. Pratt, printed by order of the house of commons for the years 1856-57; and the latter,;together with a masterly essay on the mathematical treatment of the subject, are contained in the 12th report of the registrar-general. On the imperative necessity of acting on correct tables for such a purpose, it would be superfluous to dwell; and the necessity of identifying the rates of any society with such responsible authority is the more apparent, as we are told by Mr. Pratt that " although the registrar certifies to the legality of the rules of a friendly society, it does not follow as a necessary consequence that the constitution of the society is based on good principles, or that the rates of payment are sufficient in amount to guaran tee the promised benefits and allowances." In fact, there are large numbers of insolvent societies, whose rules have been certified in the most regular manner. It cannot be too much insisted upon that the registrar's certificate is absolutely worthless as a guarantee of safety.
We have an idea of a benefit society in its simplest form:if we suppose a hundred men, of 35 years of age, to associate, and make such a payment at first as may be sure to afford each man that shall fall sick during the ensuing year is. a day during the term of his sickness. Taking, for the sake of illustration, Mr. Neison's tables, we find that, amongst such a body of men. there will be nearly 100 weeks of illness in the course of the year. This, multiplied by 7, gives the whole sum required, w85, or 7s. each, which, less by a small sum for interest, will accordingly be the entry-money of each man. A society of individuals of different ages, each. paying the sum which would in like inanner be found proper to his ale, would be quite as sound in principle as one on the simple scheryie.. only a step further to ecplitlie each man's annual payments over the whole period during which he undertakes to be a paying member.
A point for consideration, however, is the rate at which the funds of the societies may be improved. In many cases, it is best to rest content with depositing the money in the funds or the savings-banks, in which case they are sure to obtain for it interest at a rate of not less than £3 Os. 10(1. per cent per annum, or twopence per cent per clay. Some of the societies have sums invested with the commissioners for the reduction of the national debt, at threepence and twopence-half-penny per cent per day. Many of them invest with local building societies, some in corporation debentures, and in many other ways which afford a better rate of interest with safety; and the tendency to aban don the old routine of merely savings-bank deposit seems rapidly and generally growing.