and for deducting the entire promotion increase for three months in cases of promotion to increased salaries, all this applying only to the service in the District of Columbia. An estimate of the returns under these provisions, in the executive civil service in the District of Columbia, is about $350,000, based on records in the Civil Service Commission of the average number of new entrants and the average number of promotions. Census Bulletin 94 shows very exactly the number of employees in the service in the District of Columbia who would be immediately retired under part 2 of the plan, and making no allowance for deaths or separation from the service, it is figured that the cost of such annuities the first year would be $225,000. The payment of such annuities would not begin until one year after the bill went into effect, so that the fund would be collected for one year before payments were made from it. The cost of this part of the plan would increase slightly for a few years, and then would decrease until it disappeared, after all of the employees who are now old in the service had been retired and had passed away. An example of the way the plan would work in the case of a new employee entering the service after the bill went into effect is as follows: A entered the service at age 20, at a salary of $900 per annum, Deductions thereafter... At age 35 his salary was advanced to $1,400 per annum, or $116.66 per month. Increase in salary $200 per annum, or $16.66 per month. Deduction required at age 35 is 5.869 per cent. 5.869 × $16.66=. Deductions thereafter At age 40 his salary was advanced to $2,000 per annum, or $166.66 per month. Increase in salary $600 per annum, or $50 per month. Deduction required at age 40 is 6.497 per cent. 6.497 × $50 = = Deductions thereafter... $3.20 = At retirement age. $5, 126.63 1.19 1,538.00 4.39 Total deductions improved by compound interest at 3 per cent = $1,252.50. 9, 512.75 Total salary. 83,500 X 1 per cent = $1,252.50 = amount of annuity. $9,512.75 $7.59500 (cost of $1 annuity at age 70) While the committee found that the problem of superannuation existed in the executive civil service throughout the country, it is very clearly established that it is most serious in the departmental service in Washington, and as it was considered advisable by the committee to establish the plan at first only to a limited extent, the bill restricts its operations to the classified civil service of the United States in the District of Columbia. Strong representations were made to the committee from employees in the service in favor of a clause permitting retirement for disability as well as for advancing age. This was recommended by the Keep Commission, and is especially desired by the Railway Mail Service. It is admitted, however, that the inclusion of a disability clause would leave a very serious doubt as to the amount of money required by such a provision, and, in any event, it would have to be made a separate retirement feature from part 1, which is on a scientific basis, approved by actuarial standards. As the bill is made to apply only to the departmental service in Washington, as it is the belief of the committee that at first the plan should be limited, and as the element of cost of a disability clause is uncertain, the committee has not incorporated that clause in the measure. Under section 1 of the bill a very large fund would eventually be accumulated, held by the Secretary of the Treasury and credited to the individual accounts of all the employees concerned. The bill provides for the investment of this fund by the Secretary of the Treasury, and provides that interest at 3 per cent shall be paid upon it. The investment of the fund is limited by the bill. It may be deposited in national, state, or savings banks upon furnishing of certain security and the payment of at least 3 per cent interest, and it may be invested directly into certain classes of public bonds. The provisions for the selection of the bonds are a combination of the restrictions provided in the Aldrich emergency currency law and the Massachusetts savings-banks law. A careful consideration led to an opinion of the committee that 3 per cent can be earned with safe investment, and it is the belief that the periods when greater interest can be obtained will offset periods when this rate can not be obtained. No provision is made for distributing surplus interest over 3 per cent, as that can be left to the future in case any material surplus arises from this part of the plan. The bill is not a civil pension bill, but is a measure to retire employees in the civil service at their own expense, and to insure this result it is provided that the only expense to the Government shall be for administration of the fund and for the guaranty of 3 per cent interest on the funds. It is the belief of the committtee, after investigation, that the expense of administration will not be heavy, and an appropriation of $20,000 for this is provided. While points of difference arose in the committee over details of the plan and mutual concessions of views were made so that the bill as reported probably does not completely satisfy any of the committee, the committee generally agreed upon the necessity for some action, and generally favored the broad plan embodied in this bill as the most practical method suggested of retiring employees without direct contribution of the Government. DISPOSITION OF CONDEMNED BRASS AND BRONZE CANNON. FEBRUARY 23, 1909.-Committed to the Committee of the Whole House on the state of the Union and ordered to be printed. Mr. HULL, of Iowa, from the Committee on Military Affairs, submitted the following REPORT. [To accompany H. R. 28304.] The Committee on Military Affairs, to whom was referred sundry bills for disposition of condemned brass and bronze cannon, having considered the same, report herewith a substitute bill for all such bills now before your committee and recommend its passage. Sections 25, 26, and 27 of this bill are identical with S. R. 114, S. 6392, and H. R. 24627, which have been reported and are now on the calendar, and it is recommended that said bills lie on the table. |