2. SHANE JONES (Labour) Link to this
to the Minister of Finance
What recent reports has he received on support for KiwiSaver?
Hon Dr MICHAEL CULLEN (Minister of Finance) Link to this
Apart from the enthusiastic support of the member, I have received reports of support from a range of sectors, including from AXA, whose retirement survey found that 59 percent of New Zealanders who know about KiwiSaver believe that it will lead to an increase in their retirement savings. I have also seen reports from the country’s largest union, the New Zealand Amalgamated Engineering, Printing and Manufacturing Union, saying that it is prepared to include employer contributions to KiwiSaver as part of, rather than in addition to, its wage claims.
Hon Dr MICHAEL CULLEN Link to this
As we have just been listening to one hand clapping—I have seen a very wide range, from compulsion to extraordinary claims from the likes of the Business Roundtable that we do not have a savings problem, at all. The one silent voice is that of the National Party, which opposes KiwiSaver, but has absolutely no alternative.
Gordon CopelandHas the Minister seen recent media reports suggesting that KiwiSaver could be extended to all current employees; if so, has the Government given any thought to that suggestion and to the timing and practicalities involved?
Hon Dr MICHAEL CULLEN Link to this
KiwiSaver will, of course, be available to all employees; the question is whether they will be compelled to join. It is worth remembering that in Australia compulsion was introduced by way of an employer levy of 9 percent of wages in an era of high inflation and as part of a centralised wage bargain - imposed wage tax and superannuation trade-off. Such a trade-off could not be achieved in New Zealand under conditions of relatively low inflation and decentralised wage bargaining.
I raise a point of order, Madam Speaker. I thank the Minister for his response, but the reports I was referring to actually suggested simply automatic enrolment, not compulsion, with the same right to opt out as will be given to all people starting a job for the first time.
Madam SPEAKERHon Dr MICHAEL CULLEN Link to this
I will just say that I have not seen that report; if what the member means is a report that we immediately enrol everybody as an opt-out, I think that the administration would be something we could not possibly gear up for by 1 July, given the number of people involved. The advantage of phasing it in the way that we have is that anybody can opt in, but all new employees are automatically enrolled—that is, some 700,000 people a year who are new employees.