It is becoming increasingly likely the Government will cut state KiwiSaver contributions as it looks to get its books under control, the NBR reports this morning.
NBR journalist Rob Hosking cites papers from Finance Minister Bill English's advisor Paul Dyer obtained under the Official Information Act as saying government contributions to KiwiSaver increase government "dis-saving".
This comes as the Government looks to get its own spending under control and lift the overall savings level in New Zealand. The Government-appointed Savings Working Group has indicated the earliest savings would come from the public sector if government reduced spending and reversed its deficit.
Government currently pays NZ$1,000 into every new Kiwisaver account, and then matches annual contributions up to NZ$1,042 a year.
(Updates with links, government payments)
21 Comments
And replace it with....an increased compulsory employer contribution? Say ,to match the 12% that the country that we are trying to catch is going to....Maybe we could stagger the start at 5% and increase it slowly. A good way of giving every worker a Clayton's payrise that doesn't feed through into consumption.
So we are meant to catch OZ, but we cherry pick the "best bits" of any policy that suits the 1% of the country? Oh I get it.....what Brash meant was the top 1% of NZers will be able to catch the top 1% of Ozzies in the timescale if we do this....meanwhile screwing over the other 99% of NZers.
Lets get real here.....
1) Im listening to good and highly skilled NZ professionals/workers who are eyeing not only the better pay in OZ but the compulsory schemes as a package.
2) We give too much air time to the extreme right wing nutters who frankly have brought the world's financial system to the edge of the abyss just so that that top 1% can get as rich as they were in 1928 before the First Great Depression....and watched from their ivory towers while millions suffered through that Depression...
3) Do read up on the Great Depression but especially the 1920s leading up to it, the over exuberence for no work but financial gain speculation is eeirly reminiscent of today....this one however looks far far worse.
4) Study the economic impact of Peak oil, this will have the biggest effect on the World's economy bar nothing else.....it has the potential to put us in the Second Great Depression if the useless sods mentioned above dont get us there first......it will guarantee that with no cheap energy there will be no economic recovery....assets of virtually every class are valued on the assumption that there will be cheap and abundant energy and good consumer employment and spending......none of these apply after Peak Oil.....
regards
Cheers , Count : ......
..... But 68 by 2050 , and 69 years by 2075 ............ The majority of the babyboomers will be dead by then ( sorry , guys ! ) ........... So what's the freaking point of raising the retirement age ! .......... Are the good folk on that commission BB's , by chance ?
Sigh...I will try once again....govt would not need to provide a savers subsidy paid for by taxpayers if govt brought an end to the landlord rent subsidy and tax deduction on interest scams which keep property prices high and means peasant families need to either pay heaps in rent or heaps in mortgage dosh to the banks........families would have more income left over on lower rentals and lower mortgage payments...and so they would be able to save more...and spend more....creating or saving more jobs...reducing the govt unemployment and other benefit costs....boosting the tax revenue take....closing the fiscal hole..........................
But I must not go on.....it upsets some people so.....I must make peace with the hole.
No ! Please go on ........... Bugger the silly sods who rail against Wolly's views , aren't there 3 trillion other websites for them to tune in to ? ................ You vent your spleen buddy , there's more than a few of us who feel the same as you do ............
Ahh Wolly it's all a dastardly plot see here http://www.thedailybell.com/1571/It-Is-an-Anglo-American-World.html . . . lots of good reading in this thread, decided on my Christmas reading from one of the links . . . http://www.amazon.com/God-Gold-Britain-America-Making/dp/0375414037 but it's not at the bookshop, so Amazon it is.
Wait and see, if the banks flush with cash from their sales of covered bonds start a new push . . . . soft start loans and advertising . . . . No worries though, if no one borrows the money guess they will just have to pay it out in bonuses for the clever folks that sell the things.
Ring fence business investments, not just property investments, so any negative gearing will be of no use. It may result in a large number of people not being able to get a business up and running though. As for the accommodation allowance to help the poorer class people, scrap that but offer more Housing Corp places- suspect many PI's don't want to deal with this class of tenants anyway (a bit harsh but true).
The best way to close the fiscal hole is to alter the biggest handout of all, the national super, but no point in simply means testing as that would create a bigger disincentive for people to prepare for retirement. That could work couldn't it? But....
If the gov cuts the 1,042 a year contribution, then for self employed people, there will be no point in staying in it. I hope if they plan to do that, that people will be able to withdraw their funds early, and invest it in their own scheme. They should allow this, becuase it is essentially changing the rules mid way in the game. They have already removed the subsidy that pays the fees, so if they also remove the 1042 subsidy, people who decide not to continue to contribute may end up with with their savings slowly being eroded due to fees, depending on what scheme they are in.
Certainly removing it, will mean that many people won't bother to save, which is the wrong message
Who's a silly boy then Rob....you know the rules...govt can change any part of the deal they want and Noddy peasant is left to stew...but when Noddy peasant wants to change the rules....hell no...rules is rules especially appropriate for fools.
The Kiwisaver subsidy will be removed on fiscal grounds...some sort of garbage reason will be scripped for English....but the rental subsidy...and the tax allowance on interest...these two shall remain...for they are two of the legs propping up the system...and we know how important the system is....to the banks.....and the pollys...and we know why!
Five minutes ago they were wringing their hands over NZers not saving enough, starving businesses of capital and to the long-term detriment of the economy, and now they're considering removing one of the few incentives. Good thinking, guys. Is some kind of halfway coherent plan too much to ask?
Anyway, how many people are there in kiwisaver, at a max of $1,042 a year? I think it was 400,000 last I heard. That's nothing. It's pure theatre.
Kakapo.......I hate to rain on your.......the "incentive" you speak of, is coming out of the peasant's left pocket, deftly stolen as tax...and then handed over as an incentive to the peasant who is expected to smile and glow with pleasure at being loved so much by govt...and it goes into the only other pocket!.....Pollys one...peasant nil....Always keep your eye on the pea!
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.