Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1922-12-19
LelUis Would Audit
State Insurance Fund

Confined from Page Ono
on act which will give authority; in
fact, make it mandatory upon the
Auditor General. to audit the accounts
of the State Workmen's Insurance
Fund.
AS the State Workmeu's Insurance
Fund is now constituted 1t is neither
an institution, bureau or department
of the State Government. nor private
corporation. The general impression
prevails that the state Workmen In,
slrance Fund is State institution and
is department of the State Gov
ernment sustaining practically the same
relations to the State as those exist
ing. for example, between the state
and the Workmcn's Compensation
Board, the Insurance Department or
the banking Department..
This impression that 1t is State
institution or bureau is due, no DOUBT,
70 the fact that in the period of the
formation and development Of tho state
Workmen's Insurance Fund tho money
for its organization and operation was
provided by Legislative appropriation.
This money has. however. since been
paid back to the State Treasury out
of the earnings of the fund.
Fund. as matter of fact. sustains
very anomalous relationship with
the State Government. The parties
who take ont insurance are. in man.
ner. regarded as stockholders. but they
have no control or voice in the man.
agement of the institution. 1t is ap-
parently run on the mutual, plan. yet
it is not n mutual company, neither
is it stock company.
"Inder the law the fund Is con.
trollrd and administered by the heads
Of three State departments: namely.
the state Treasurer, the Insurance
! Commits I;Nn"r and the Commissioner OF
Labor and Industry. Three officers are
! charged with making the investments.
| making the rules and regulations, clas-
sfy ing the subscribers, fixing the rates,
declaring the dividends, making con-
tracts aud performing all rthrr duties
connected with the administration Of
the furd.
THE emp'oycs are by act Of Assem-
bly, declared to be employees OF the
State, Yet the State does not make aay
! appropriation for the payment Of their
salaries, as is tho c%sc with the en-
ployes of all other departments Of the
State Government. These salaries arc
fixed by the board and are paid out
atiny as an independent organization.
"Thc manager and other officers are
appointed by the board with the np-
prOval ot the Governor, and tho man
nger j. responsible to none but the MEM
bCrs of the board for ovn"nhilHr"~. SAL
aries paid. while tho State Treasurer is
custodian of the fund.
''The Attorney General Of III" State
is general counsel for the board and
! a. .,,l inf -
salaries "t attorneys to act as counsel
for the board.
"Ihc members Of the board. namely.
the state Treasurer. tn" Insurance
Commissioner and the CommiN9ionrr OF
Labor and Industry. no doubt have
certain auditing and supervisory powers
over the fund. but neither the Auditor
General nor anv other disintercsted off
cor NOT connected with the board has
i within his power to audit investments,
salaries and expense accounts rs ~
Inna IN connection with other depart
.'rLr state. through its chief audit
inc nf;rer. namely. the Auditor General.
nndiIs III" departments Of al three OF
,hr I,firiols mentioned as members of the
hoard. having control over their sal
aries aud expenses e>c'nl!ng where hNed
hr stotutr. but over the board itself,
Wnirh oro c,ists no such control ar
ciniS, ,.', ,s,norvision and. strange "a
sor thrrr is no means Of exercising the
say, ;nn'' and sunorylsorv powers con
aun',i TX ". ,hc Constitution over the fund
i"rII'r,' ')
HS','' . u,s Va .ut,or,,y <o,
Au"''"r las ~" ''."'"' .,"".''. ,'"" ,,"s..,
Is tn the effect that the Auditor Gem
ernl has no authority Nha'"''r I" check
up these securities; NndrrHthnI that
approximately S-6'uOo'u''o "' bonds and
securities ~" now ~ ~" hohds OF 'hc
State Treasurer. f"r th' Nr"t'rion ot
the star" TrrdSnrrr as 10" cuNtndinn OF
thrs" ~""rilrr, It" Hoard ct fMhIiC
truundS ana fulIdingS r'""h'Iy entered
into an agreement W'th a surety com
} Tany providing for burglary ana THEFT
insurance,