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Wednesday, 4 March 1970

The Government will introduce arrangements under which most salary and wage earners will be provided with facilities for health insurance contributions to be regularly deducted from their wages or salaries by their employers, if the employees so desire. The voluntary group deduction scheme has already been developed to some extent and has provided many employees with protection against loss of fund membership through neglect to pay contributions when they fall due. It has also materially assisted some funds to reduce their levels of management expenses. However, it is now proposed that facilities for the deduction of contributions from salaries and wages should be made more widely available, both in the interests of individual contributors and for the more effective and economical operation of the health insurance system.

Based on the Government's general endorsement of recommendations 27 and 28 by the Nimmo Committee, this measure introduces an entirely new principle into the administrative system of health insurance. A new group deduction system will therefore be established under which employees will be entitled to have their health insurance contributions deducted from their salary or wages and remitted by the employer to a health insurance fund, if the employee so desires. The Government considers it appropriate that the new group deduction scheme should operate without the payment of commission to employers. These new arrangements will, of course, involve additional effort on the part of some employers, but the Government is confident that employers will be prepared to accept this work as a genuine community service.

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