Friendly Societies Act 1875
Encyclopedia
The Friendly Societies Act 1875 was an Act
of the Parliament of the United Kingdom
passed by Benjamin Disraeli's Conservative
Government following the publication of the Royal Commission
on Friendly Societies
' Final Report.
The Act encouraged friendly societies to register with the Registrar of Friendly Societies by granting them the legal right to own land and property in the name of their trustees and the ability to take out legal proceedings in return for accepting tight regulation as a condition of being registered in the shape of submitting quinquennial returns on sickness and mortality which would be used to evaluate their assets against liabilities.
Friendly societies paid de facto old-age pension
s in the form of sickness benefit and the Act defined "old age" as 50 and above, and although a court ruling claimed that "natural decay" was not "sickness" the majority of friendly societies did not accept this ruling as they were in competition with each other and so therefore wanted to continue paying pensions to attract new members.
The Act allowed friendly societies considerable self-management "but insured the adoption of sound rules, effective audit, and rates of payment sufficient to maintain solvency. It established the friendly societies, and with them the people's savings on a satisfactory basis".
Act of Parliament
An Act of Parliament is a statute enacted as primary legislation by a national or sub-national parliament. In the Republic of Ireland the term Act of the Oireachtas is used, and in the United States the term Act of Congress is used.In Commonwealth countries, the term is used both in a narrow...
of the Parliament of the United Kingdom
Parliament of the United Kingdom
The Parliament of the United Kingdom of Great Britain and Northern Ireland is the supreme legislative body in the United Kingdom, British Crown dependencies and British overseas territories, located in London...
passed by Benjamin Disraeli's Conservative
Conservative Party (UK)
The Conservative Party, formally the Conservative and Unionist Party, is a centre-right political party in the United Kingdom that adheres to the philosophies of conservatism and British unionism. It is the largest political party in the UK, and is currently the largest single party in the House...
Government following the publication of the Royal Commission
Royal Commission
In Commonwealth realms and other monarchies a Royal Commission is a major ad-hoc formal public inquiry into a defined issue. They have been held in various countries such as the United Kingdom, Australia, Canada, New Zealand, and Saudi Arabia...
on Friendly Societies
Friendly society
A friendly society is a mutual association for insurance, pensions or savings and loan-like purposes, or cooperative banking. It is a mutual organization or benefit society composed of a body of people who join together for a common financial or social purpose...
' Final Report.
The Act encouraged friendly societies to register with the Registrar of Friendly Societies by granting them the legal right to own land and property in the name of their trustees and the ability to take out legal proceedings in return for accepting tight regulation as a condition of being registered in the shape of submitting quinquennial returns on sickness and mortality which would be used to evaluate their assets against liabilities.
Friendly societies paid de facto old-age pension
Pension
In general, a pension is an arrangement to provide people with an income when they are no longer earning a regular income from employment. Pensions should not be confused with severance pay; the former is paid in regular installments, while the latter is paid in one lump sum.The terms retirement...
s in the form of sickness benefit and the Act defined "old age" as 50 and above, and although a court ruling claimed that "natural decay" was not "sickness" the majority of friendly societies did not accept this ruling as they were in competition with each other and so therefore wanted to continue paying pensions to attract new members.
The Act allowed friendly societies considerable self-management "but insured the adoption of sound rules, effective audit, and rates of payment sufficient to maintain solvency. It established the friendly societies, and with them the people's savings on a satisfactory basis".