employ of the city must contribute to one or the other of these funds and may share in the benefits. The city pension fund includes the mayor, the city councillors, engineers, clerks, teachers, policemen and so on. The employees' maintenance fund includes firemen, street-car employees, employees of the gas, electric light and water works, janitors, street laborers and other workers. The amount of the pension under the city pension fund is determined upon a percentage of the official salary. The pension paid to the mayor or to a city councillor, in case of disability occurring during the first year of service, amounts to seven-tenths of the salary; in case of disability occurring during the second year, eight-tenths; from the third to the thirty-ninth, nine-tenths; from the fortieth year on, the full amount of the salary. Officials and employees ranking below the mayor and the councillors receive, if pensioned during the first five years of service, five-tenths of the salary; if during the period from the sixth to the thirtyninth year, nine-tenths; from the fortieth year on, the full amount of the salary. Widows receive from two-tenths to four-tenths of the salary, according to the length of service of the husband, and an additional allowance for each child under 20 years of one-fifth of the amount of pension. The city pension fund is maintained by assessments upon the salaries of the prospective beneficiaries, including a lump payment of 10 per cent. of the annual salary when the employee enters the service, and an annual assessment ranging from 212 per cent. to 312 per cent. Persons entering the municipal service at 35 years of age or under pay the lower percentage, while those coming in later pay the higher rate. An exception is made in the case of the mayor and the councillors, who are assessed only 1 per cent. on the salary. This system has been in operation since 1875. States Consul George N. Ifft states: United It is not only generally satisfactory, but is highly praised. A bill for an ordinance is now pending, abolishing all assessments upon the prospective beneficiaries for the maintenance of the pension fund, and placing the entire burden on the city. This is in line with recent enactments of the Bavarian government in the matter of pensions for State employees, and it will undoubtedly be adopted in due time. The employees' maintenance fund was established in 1901, to provide for municipal employees who were not included in the city pension fund. In order to participate in the benefits of this fund, a person must enter the service of the city between the ages of 21 and 40 years, and must have paid assessments for at least five years prior to application for a pension, and must be totally disabled. The amount of the pension after five years of service is 30 per cent. of the annual wages, and 1 per cent. additional for each year thereafter, till the pension amounts to 60 per cent. of the wages. Widows receive from one-third to one-half of the amount to which the husband would have been entitled, and an additional allowance for each child under 15 years of age of one-third of the amount of the widow's pension. The assessments for this fund are graduated as follows: 21 to 25 years of age, 12 per cent. of the wages; 25 to 30 years, 2 per cent.; 30 to 35 years, 212 per cent.; 35 to 40 years, 3 per cent.; 40 years on, 312 per cent. An employee discharged for reasons other than negligence, laziness and the like, receives three-fourths of the amount paid in by him. An employee who leaves the service voluntarily gets no rebate. (h) Marseilles. The pension system of this city provides for all municipal employees, including two classes, as distinguished in the pension act, indoor or clerical workers, and outdoor or manual laborers. Employees of the former class are pensionable at the age of 60, after thirty years of service; those of the latter class at the age of 55, after twenty-five years of service, which must include fifteen years of outdoor employment. The system also provides for the pensioning of employees for incapacity, regardless of age. Under the provisions for this class of pensions, the following are pensionable: first, employees who have been incapacitated through injuries received in the performance of heroic acts for the public good; second, employees disabled through injuries received in the discharge of their duty; third, employees of 45 years of age and fifteen years of service on the clerical staff, those of forty years of age and ten years of service on the outdoor staff who are afflicted with a serious infirmity or disease evidently caused by the peculiar nature of their work, and employees who have been discharged for reasons of economy. The amount of pension is calculated on the basis of the average annual salary. The age pension for clerical workers, after thirty years of service, and for outdoor workers after twenty-five years of service, shall not exceed one-half this salary basis; then for each additional year the pension is increased by 5 per cent. of the half salary. In no case shall the pension exceed two-thirds of the salary basis. The disability pension for employees of the first group, as given above, is one-half of the last salary; for those of the second group, the amount of the pension is calculated upon the basis of the last salary and the nature of the work; for those of the third group, the pension is similar to that of the second. In each case one-sixtieth is added to the pension for each year of service for clerical workers, one-fiftieth for outdoor workers. The pension fund is maintained by salary assessments and by various other contributions, including the following: first, 5 per cent. of the salary; second, the first month's salary of each new employee; third, the first month's increase of salary in case of a salary raise; fourth, a part of the fines imposed by the municipality; fifth, the revenue from French bonds held by the municipality; sixth, subventions granted by the communal budget. (i) Paris. The beginning of the municipal pension system of Paris dates back to 1813. The system has been modified by various enactments, the last of which was passed in 1897. In its present form the system is administered under a municipal ordinance of 1882. All employees of the city are eligible to pensions under the conditions prescribed. The right to a pension is granted to: (a) employees who have been in the service of the city thirty years, and have reached the age of 60; (b) employees who have served ten years, and are prevented by inability from continuing in the service; (c) employees who are injured in the performance of duty, irrespective of age or length of service. The amount of the pension is determined by the length of service and the rate of wages of the employee. The calculation is based upon the average earnings of the last three years. The pension amounts to one-sixtieth of this average for each year of service up to thirty years; thereafter it is increased by one-fortieth of the average for each year, until the pension amounts to 6,000 francs ($1,200), which is the maximum. The pension for persons injured in the service is one-fortieth of the average wages for each year of service; in no case, however, shall such a pension be less than onesixth of the average wages. Pensions are granted to widows and orphans at rates proportionate to the pension to which the deceased employee would have been entitled. An employee dismissed or retired for disciplinary reasons loses his claim to a pension. The cost of the system is borne in part by the city and in part by the employees. The contribution by the latter is 512 per cent., deducted from the wages during the entire time of service; also, the first month's increase of wages in case of an advance in pay, is taken for the pension fund. The amount contributed by the city is equal to 10 per cent. of the total wages of the employees. The pension fund also has the benefit of certain fines, gifts and subventions. Concerning the working of the system, United States Consul Dean M. Mason states: The duty of a city to pension its employees is generally accepted in this country, and, on the whole, the system adopted in Paris is generally considered satisfactory. VIII. GENERAL CONCLUSIONS CONCERNING NON CONTRIBUTORY PENSIONS, COMPULSORY (a) Non-contributory Pensions. The adoption of any scheme of non-contributory pensions in Massachusetts, or any other American State, seems inadvisable and impracticable. The main reason for rejecting pension schemes of a non-contributory character are, in brief: 1. The heavy expense. Under the British act, out of a total population 70 years of age and over of approximately 1,270,000, about 667,000, in round numbers, have already qualified for pensions. This is a percentage of rather more than one-half. Applying a similar percentage in Massachusetts, it would be necessary to provide for at least 50,000 persons, under a scheme similar to the British, as the total population of the State 70 years of age and over in 1910 may be estimated on the basis of the census returns of 1905 as approximately 105,000. The amount of the pension granted could hardly, if adequate for American standards of living, be less than $200 per year, or $4 per week. To provide pensions of that amount for half the population 70 years of age and over would cost not less than $10,000,000 per year. That cost is practically prohibitive for any such scheme. It would mean an addition of considerably more than 200 per cent. to the State tax, which is now $4,500,000. The cost of providing pensions of $200 for one-half the aged population 65 years of age and over, which may be estimated at 177,000, would be approximately $17,700,000 annually. This would increase the State tax by about 400 per cent. |