Society officials on the importance of the preventive aspect of their work. As a result, increased attention is now being paid by such officials to questions of unhealthy local and occupational conditions, treatment of members suffering from tuberculosis, and the adequacy of local medical services.

The closing months of the period were marked by a serious influenza epidemic, with consequent heavier benefit payments than during any other period since the inception of the Acts. Happily there are indications that claims are now reverting to normal.

BENEFITS.

Sickness, Disablement and Maternity Benefits.

The issues of funds from the Department to Approved Societies to enable them to pay benefits to their members and defray their expenses of administration amounted during the year 1921 to £937,037 8s. 11d. The aftermath of the War is still apparent in the correspondence which has reached the Department during the past year in regard to these benefits. Much useful work has been done in assisting insured persons who had lost touch with their Societies and in consequence were unable to obtain the benefits to which they were entitled.

As a result of the great pressure of economic conditions insured persons have been very insistent on the prompt settlement of their claims, and information in possession of the Department has enabled steps to be taken in this direction.

The Application of the Arrears Scheme to the Contribution Year ended 3rd July, 1921.

The adverse industrial conditions already referred to resulted in an abnormal proportion of the insured population being in arrears in respect of the contribution year ended July, 1921. As the result of a careful investigation it was recognised that some modifications in the existing arrangements for the discharge of arrears were desirable to meet these conditions. Regulations were accordingly framed to meet the situation. The state of unemployment in Wales was probably more serious than in any part of the United Kingdom, and numerous representations were received by the Department from Approved Societies on behalf of individual members and classes of members in whose cases exceptional circumstances were deemed to merit special treatment. Full consideration was given to all the evidence submitted in such cases, and further extensions of the "period of grace" were granted where such a course appeared to the Department to be justified.

QUESTIONS AS TO LIABILITY TO INSURANCE.

It was not found necessary, during the period under review, to give any formal decisions under section 66 of the National Insurance Act, 1911, but a large number of questions relating mainly to liability to compulsory insurance were disposed of informally.

Exemptions.

The number of exempt persons at the 31st March, 1922, was 768 as compared with 822 at the 31st March, 1921. Of this number 320 have had their certificates "applied" for the purpose of obtaining

exemption from Unemployment Insurance. The number of certificates issued under the National Health Insurance Act, 1919, decreased from 96 to 31, but there was a net increase of eleven in the number of certificates granted on other grounds. The number of exempt persons entitled to medical benefit on the 31st March, 1922, was 910 (733 men and 177 women), of which number 173 are persons whose certificates have been cancelled but who remain entitled to benefit, and 63 are exempt persons over 70 years of age.

During the year the Department scrutinized on behalf of the Ministry of Labour 520 claims for exemption from Unemployment Insurance. The number of unemployment exemption certificates current on the 31st March, 1922, was 555. There was a reduction of 122 during the last three months of the period.

Certificates of Exception under Paragraph (b) of Part II of the First Schedule to the National Insurance Act, 1911.

As explained in last year's Report, it became necessary, in consequence of the increase in the statutory rates of sickness and disablement benefits made by the Act of 1920, to consider the validity of the certificates of exception issued to public authorities. The outstanding case referred to in that Report has now been dealt with, the old certificate having been withdrawn and a new certificate issued in lieu thereof.

One new certificate of exception was, in addition to that referred to above, issued during the period under review.

DEPOSIT CONTRIBUTORS.

General.

The total amount paid by the Department during the year to deposit contributors for benefits, etc., amounted to £3,214 16s. 7d.

At the 31st March, 1922, the number of open deposit contributors' accounts was 10,850 (representing 8,240 men and 2,610 women)—a decreas of 800 during the year.

The number of Navy and Army Fund members whose health is no longer such as to preclude them from joining an Approved Society and who have become Welsh deposit contributors shows a considerable increase, and it is remarkable that the number of accounts (1,600) opened on service contributions during 1921 is only about 200 less than the number opened during 1920.

An account of the Deposit Contributors' Fund is included in the published accounts of the National Health Insurance Fund (Appendix XXII, page 165 below).

Transfers of Deposit Contributors to Approved Societies.

During the year 5,020 transfers were dealt with as compared with 6,750 in the previous year. The number of established transfers included in these totals, however, increased from 2,510 to over 2,600.

Continued efforts have been made to secure the transfer of deposit contributors to Approved Societies.

In September a circular letter was issued to each new entrant during the previous contribution half-year who had not then joined an Approved Society. This letter pointed out the advantages of Society membership and the method of joining, and advised the contributor to apply for membership before the 1st October. A form was enclosed on which a contributor might furnish the Department with Society particulars. An examination of the position shows that over 60 per cent. of these new entrants have joined Societies, the majority having been accepted before the 1st October.

Similar action, with correspondingly satisfactory results, has been taken in the case of the second half-yearly entrants, and the letter is now being issued to newly-established deposit contributors. The issue of this letter to contributors already established and resident in selected areas resulted in about 25 per cent. applying immediately for Society membership.

WORK OF THE OUTDOOR STAFF.

Inspections.

The year under review has been a particularly difficult and strenuous one for the Outdoor Staff. The coal stoppage and its consequent effect upon other industries brought in its train a crop of problems and difficulties, particularly among the large employers of labour. The arrangements made with the Ministry of Labour by which the Department became responsible for securing the payment of contributions under the Unemployment Insurance Acts from July, 1921, also entailed considerable additional work. These arrangements made it necessary to pay special attention to the provision of information and to survey work. Steps were accordingly taken to make an immediate extensive survey throughout the country in order that as many towns and villages as possible should be visited to ascertain the position as to Unemployment Insurance and to make the provisions of the Acts known. From the 1st July, visits were made to every important town and village in Wales, with the result that 11,032 inspections were made, covering 324,675 insured persons.

Every possible opportunity was taken to test the position, not only in industrial and rural areas, but also in selected trades and occupations. Special attention was given to large works and collieries, shipping, housing schemes, Local Authority relief schemes, theatres and cinemas, and tailors' workshops, as well as to other trades where it was thought that the provisions of the Unemployment Insurance Acts would not be properly known or where non-compliance was likely to be found. The aid of employers' associations and secretaries of trade organizations was also sought to make the provisions of the Act widely known.

A comprehensive shipping survey was made by one of the Inspectors at the Cardiff, Swansea and Newport Docks; 151 firms were visited, and, while the insurance arrangements generally were gone into, special attention was directed to the question of domicile.

Reports from all the districts show that the position as to Health Insurance compliance is satisfactory, and that, notwithstanding considerable trade depression, employers generally evince every desire to observe their obligations under the Acts. When there is evidence to show that employers have not carried out their obligations, little or

no difficulty is experienced in settling cases satisfactorily with them. Complaints by insured persons are usually of a nature which show considerable apathy on their part, and in most cases the irregularity would not have occurred if the insured person had taken more interest in his own insurance.

Assistance to Approved Societies.

The work done in connection with Approved Societies during the year has been considerable. The special attention given to contribution revenue and the bearing of unemployment on arrears, to benefit expenditure, and to other aspects of Approved Society work, was continued with satisfactory results.

One direct result of visits by Inspectors and of conferences held during the year is that considerable assistance is now being rendered to the Department by Approved Society secretaries in dealing with cases of non-compliance. In this way there has been established a co-operative arrangement of working as between Approved Society secretaries and the Outdoor Staff which is bound to have good results.

Prosecutions.

During the year prosecutions were instituted against seventeen employers for various contraventions of the Acts, e.g., failing to stampor return their employees' contribution cards. Convictions were

obtained in thirteen cases; two were ordered to pay the arrears of the contributions due and costs, and two cases were dismissed owing to conflict of evidence. In one case, where previous convictions were proved, the employer was fined the maximum penalty of £10 on each of the summonses.

FINANCE AND ACCOUNTING ARRANGEMENTS.

Security given by Approved Societies.

Statements are given in Appendix XXI (page 164 below) showing the general position of Societies operating in Wales in regard to the question of giving security, and particulars as to reported cases of malversation, etc., of State Funds.

Issues of Funds to Approved Societies.

In the first half of the year issues were adversely affected by widespread unemployment.

In the second half of the year additional benefits, in accordance with the various schemes adopted by Approved Societies, became payable; but, in spite of this fact, issues of funds were actually not as heavy as in the first half of the year. Reviewing the period as a whole, it may be said that although issues in 1921 were actually greater than in 1920, the increase was not more than would be accounted for by the introduction of the increased rates of ordinary benefits in the course of the year 1920, and the commencement of additional benefits in July, 1921.

As a consequence of the increased administration allowance which was sanctioned as from the 1st January, 1921, a very large majority of Approved Societies were able to keep their 1921 expenditure within the appropriation. There were, however, a few notable exceptions.

Investments.

In consequence of the pronounced effect on the Welsh Funds of Societies of trade disputes and the general industrial depression prevailing during the first half of 1921, it was decided not to release any sums for investment at the 30th June, 1921; the usual ascertainment was made, however, at the 31st December, 1921.

Amount available for Investment.

The subjoined table shows the transfers and payments in respect of investments up to the 31st December, 1921 :—

Particulars.

Amount automatically transferred to the Investment

Account.

Amounts available for investment by Societies:(1) Transferred to Investment Account

(2) Paid over to Trustees of Societies for Investment (3) Invested by the Department in Securities selected by the Societies.

Total Amount

The total amount transferred to the National Debt Commissioners for investment is £2,165,000.

Accounts of the Welsh National Health Insurance Fund.

The accounts of the Welsh National Health Insurance Fund, together with the Report of the Comptroller and Auditor-General thereon, for the year 1919, have been published as a Parliamentary Paper (H.C. 22 of 1922). An abstract of cash receipts and payments out of the Welsh National Health Insurance Fund for the year 1921 is given in Appendix XXII (page 165 below).

A statement of approximate receipts and payments under the National Health Insurance Acts in Wales for the year 1921, showing accumulated funds at the beginning and end of the year, is given in Appendix XXIII (page 166 below).

Contributions of Army and Air Force Members for periods to the 31st December, 1920.

In view of the introduction of a new system, as from the 1st January, 1921, a special appeal was made to Societies to endeavour to dispose of all outstanding cases, so as to facilitate the early winding up of the old scheme. Although much has been achieved in this direction it is evident that, owing possibly to difficulty experienced in securing the necessary supporting evidence, certain units will have further claims. to submit on the occasion of the 1921 audit. Every opportunity is being taken of emphasising the desirability of immediate action in this connection.