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wages, the two sections thus corresponding to the pension fund and the mutual benefit society. The second section, like its prototype, combined sickness insurance and medical aid with old-age invalidity insurance and widows' and orphans' pensions. In case of promotion to a monthly salary, members of the second section were transferred to the first section.

SOURCES OF INCOME.

As in distinction to the two older institutions described, the benefits of this institute depended primarily upon the individual accounts. It is necessary to analyze these accounts and all sources of revenue before stating the amounts of pensions and other benefits.

These sources of revenue are stated in the constitution as follows: (1) The regular deductions from the earnings of the members. (2) Extraordinary deductions. (3) Voluntary contributions of the members. (4) Contributions of the railroad administrations. (5) Special assigned sources of revenue. (6) Extraordinary revenues, such as legacies, donations, etc, and (7) Revenues from investments of funds.

Briefly, these sources may be classified into three groups: Employees' contributions, the railroad management's contributions, and miscellaneous revenues. In detail, these sources of revenue differed for the two sections of the institute.

The regular contributions of the members were identical with those in the pension fund and the mutual benefit society-i. e., 5.5 per cent of the salary for the first section and 3.5 per cent for the second section. The extraordinary contributions contained the deduction of one-twelfth of each annual increase of salary and, besides, an initiation fee of one-tenth of the annual salary at appointment. As each member's account was an individual one, the members were permitted to increase these accounts by additional voluntary contributions, which during any one month, however, must not exceed one-fifth of the salary.

The regular contributions of the railroad administration were identical with those for the pension fund and the mutual benefit society, namely, 8 per cent of the salary for the members of the first section and 8.15 per cent for the members of the second section, and amounts equal to the members' extraordinary contributions, not only promotion contributions, but also initiation fees.

The additional sources of revenue from the administration were shares of the revenues assigned to the pension fund and the mutual benefit society. The first section shared with the pension fund and the second with the mutual benefit society, the distribution being

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affected annually in proportion to the aggregate earnings of the membership.

The various revenues enumerated were distributed into two distinct systems of accounts, the individual accounts and the collective account. The individual account of each member was made up of his compulsory deductions, his voluntary contributions, and the contribution of the railroad administration, to which at the end of each year was added interest at the rate established each year according to the computed rate of interest received by the institute. This account was payable to the member at time of leaving the service or to his family after his death. The collective account claimed all the other revenues and also certain transfers of the undistributed individual' accounts or parts of accounts, as explained below. It was to be used for increasing the individual accounts of members leaving service because of old age and invalidity, and of families of members, according to special regulations to be issued.

In addition there was also a reserve fund into which certain amounts from other funds were paid, as explained below.

BENEFITS.

The annual benefits payable to members depended upon the amounts of accumulations in the individual accounts, and approached therefore a system of subsidized and compulsory savings.

The entire account was paid at the time of separation from service, either by resignation or by administrative order, under one of the following conditions:

(1) If the member had reached 60 years of age and completed 30 years of membership, in case of sedentary occupations, or 55 years of age and 25 years of membership, in active occupations. .

(2) If the separation from service was due to invalidity, after 15 years of membership,

(3) Without any consideration as to the length of membership if the separation from service was due to invalidity caused by an injury received in service or by a miasmatic fever.

Thus the regulations for old age and invalidity insurance for all the members (i. e., for both sections) were similar to those for the pension fund, and a superannuation pension was introduced for the lower-grade employees, who before had only an invalidity pension.

The entire individual account was also liquidated in case an employee was discharged without any fault of his, but because of a change of personnel, even before he had reached the above-mentioned limits, provided he had held membership for 15 years.

PENSIONS AND LUMP Sums.-The constitution further provided that when the member received the full value of his individual ac

count, it must be converted into a life pension (after 2 per cent is deducted in favor of the reserve fund). An exception was made in the case of the member whose account was liquidated before 15 years of membership, when the account must be paid out in a lump sum, except that in cases when the pension would amount to not less than 200 lire ($38.60) per annum such conversion might be demanded by the recipient. In the compulsory conversion of the total individual account into a pension, the rights of the wife and children must be taken into consideration. Thus, if a member had a wife but no children, she was entitled after his death to a pension of one-half the amount of his pension until her death or remarriage. If besides the wife there were minor children, they were entitled, if under age at the time of his death, collectively to one-fourth of his pension until majority. If the pensioner was a widower with children, they had a right to receive after his death and until majority one-half of his pension, or if there was only one child, one-fourth of his pension. All these pensions, together with the pension of the member, were purchased out of the liquidated individual account.

PARTIAL LIQUIDATIONS.-Unless one of the conditions enumerated above existed, the right of the employee to his individual account at the time of leaving the service was limited, except to the voluntary contributions, which together with interest accrued, were paid out at the time of leaving service for any cause.

If the employee left the service, unless dismissed for disciplinary reasons, he was entitled to receive his own contributions with the interest accrued. The remaining portion of the individual account was divided between the collective account and the reserve fund, the former receiving nineteen-twentieths, and the latter one-twentieth.

BENEFITS TO WIVES OR WIDOWS AND CHILDREN.-If the employee should be dismissed after 15 years of membership, the entire account was to be liquidated in favor of his wife or minor children, and if he died in service after 15 years of membership, in favor of his widow and minor children. The requirement as to the length of membership was waived in case of death because of an injury or a miasmatic fever. These amounts were convertible into pensions for the wives, widows, or children, unless the membership did not last 15 years; the pensions to widows were to run until remarriage and to the children to majority.

If, however, the dismissal or death took place before this 15-year limit and in absence of any conditions (injury or disease) causing the time limit to be waived, the widow or wife and children were entitled only to the employees' contributions with interest accrued. In this case, as in the case of the benefit being paid to the member himself, the retained portion of the account was divided between the collective and the reserve funds.

The rights of the widows and orphans of employees who died after having drawn their full accounts from the institute were provided for at the time of the liquidation of the account, when their pensions were computed, as explained above.

As the rights of the widows and children were rather complicated, they are briefly summarized again.

(1) When the ex-member died after having liquidated his full account and received a pension, the widow received one-half of his pension, and minor children one-fourth of his pension. If minor children, but no widow, survived, they received one-half of his pension, in equal shares.

(2) If an ex-member died after he received only his own contributions with interest, part in lump sum, his widow and orphans had no right.

(3) If a member died while in service and after 15 years of membership (or from injury or miasmatic fever, when this condition is waived), the entire individual account was liquidated in favor of his widow and minor children, and converted into pensions, the distribution being affected in such a way that the temporary pension of each minor child was equal to one-third of that of the widow.

(4) If a member died while in service but before 15 years of membership, the widow received in a lump sum only the contributions of the member with interest accrued.

The general conditions required to entitle the widow and children to benefits were identical with those for the other two institutions described above.

In case of dismissal from service for cause, the wife and children had the same rights as a widow and orphans.

LIMITS OF PENSION.—The pension to an employee was not to exceed four-fifths of the average annual salary during the last quinquennial period for the members of the first section, and 2.50 lire (48 cents) per day for the members of the second section.

The pension of widows (with or without one minor child) of the first section must not exceed two-fifths of that average annual salary, nor must it be larger than 4,000 lire ($772) per annum. If there were minor children, the total pension must not exceed three-fifths of the average annual salary, nor 6,000 lire ($1,158).

When two or more minor children without a mother survived, the limit of their pensions was the same as for the widow; for one minor child the maximum limit was one-half of that for the widow.

For the widows of members of the second section the limits were very much lower: Namely 1.25 lire (24 cents) per day with or without one child, and together with two or more minor children, 1.90 lire (37 cents) per day. All amounts from the individual accounts in excess of these limits reverted to the collective fund.

SPECIAL BENEFITS FOR MEMBERS OF THE SECOND SECTION.-It appears from the foregoing analysis that much more uniformity had been introduced in the treatment of employees of the two classes, the main difference being in the rate of compulsory monthly contributions from the employees' earnings and in the different sources for supplemental revenue of the collective fund.

The other important difference was that the second section included besides old-age, invalidity, and retirement relief, also the functions of sickness insurance similar to those of the mutual benefit society.

SANITARY SERVICE. It will be remembered that the mutual benefit society conducted a medico-sanitary service for the entire personnel of the railroads, the expenses being shared by the second section of the provident institute. The constitution of the latter provided that as soon as the total earnings of its members exceeded that of members of the mutual benefit society it should assume this function, the mutual benefit society sharing in its expenses. The benefits in the nature of medical and surgical help, hospital treatment, medicinal bath, funeral benefits, etc., were identical with those of the mutual benefit society enumerated on page 1963.

Sick BENEFITS.—Sick benefits of two-thirds the daily wages were paid to the employee deprived of his earnings because of illness, provided he had been subject to deductions from his salary for at least 30 days. The conditions of payment of sick benefits were identical with those of the mutual benefit society.

Cost oF SICKNESS INSURANCE.-As far as the medical service and the sick benefits were concerned, the principle of mutuality was applied to the second section. The entire cost of sickness insurance to the second section was divided among the members proportionately to their annual earnings, and the respective amounts were deducted from their individual accounts.

ACCIDENT INSURANCE.—Similar to the other institutions, the provident institute, in case of industrial accidents, assumed the responsibility toward all its members who were subject to the accident insurance law.

The general methods applicable in the case of this institute were practically identical with those of the pension fund and the mutual benefit society, except that in case of death or of permanent disability necessitating separation from the service, the injured person or his family received the personal contributions with the interest accrued in addition to the compensation required by the law. The remaining portion of the individual account reverted to the collective account. But if the total amount paid under the accident law, plus these personal contributions, was still less than the amount to which the injured

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