2. Hon PAUL SWAIN (Labour—Rimutaka) Link to this
to the Minister of Finance
What action has the Government taken to restore and increase the level of New Zealand superannuation?
Hon Dr MICHAEL CULLEN (Minister of Finance) Link to this
One of the first things the incoming Labour-led Government did after the 1999 election was to restore the level of New Zealand superannuation to 65 percent of the average wage for a married couple. It had been cut, of course, by the previous National Government, in which Mr English was a Minister of Finance. Since then, and subject to the agreement with New Zealand First, that floor has been lifted to 66 percent of the average wage. We have also set up the New Zealand Superannuation Fund to ensure the affordability of New Zealand superannuation into the long-term future.
Hon Dr MICHAEL CULLEN Link to this
Yes, I have seen a report stating that Mr Key has pledged to resign if there are changes to superannuation policy in the unlikely event of a National Government. That, of course, is reminiscent of Dr Lockwood Smith’s famous 1990 promise to resign if we did not remove tertiary fees, which then of course were massively increased. And of course there was the famous “no ifs, no buts, no maybes” promise to remove the superannuation surcharge, which was then increased in the subsequent Budget by the National Government. But perhaps, as Dr Smith said, this is one of those “bloody dead fish you have to swallow” in order to do “some useful things that way that may not be policy right now.”
Hon Jim AndertonCan the Minister confirm that if we do not continue to save money through the New Zealand Superannuation Fund, taxes on the current generation of young New Zealanders will have to increase in order to keep superannuation payments at the same level that they are at today, or conversely, if we cut savings in the Superannuation Fund and we do not increases taxes, superannuation payments will have to be cut in the future?
Hon Dr MICHAEL CULLEN Link to this
Yes. One of the great ironies would occur if a potential National Government reduced contributions to the Superannuation Fund in order to pay for tax cuts, because the long-term effect of that would be to increase the tax rates that have to be paid in order to support New Zealand superannuation.
Hon Dr MICHAEL CULLEN Link to this
Yes, I have seen reports from the Hon Bill English that describe the current provision of retirement income as “too generous” and speculate about the need for Australian-style income or asset testing. That is not surprising. Mr English is the man who cut the level of New Zealand superannuation—
Hon Bill EnglishHon Dr MICHAEL CULLEN Link to this
It is not true that Mr English cut the level of New Zealand superannuation in 1998-99? He has forgotten the legislation that cut the floor for superannuation payments to 60 percent of the average wage for a married couple, down from 65 percent. He has forgotten he was part of a Government that froze New Zealand superannuation for 3 years out of 9, and that in only 6 of the 9 years gave an increase in superannuation payments.