Election 2011 - Party Policies - Tax - KiwiSaver
24th Jul 11, 5:58pm
- The transition to the new retirement system will take 40 years when 90 percent+ of New Zealanders are expected to have sufficient savings to provide for themselves.
- It will be available to New Zealand citizens aged 18 - 65 years of age.
- During the transition, retirees will receive two pensions. One based on the fund accumulated via tax savings each year and the second a percentage of the existing government benefit, dependent on the number of years individual has been eligible to be a member of new retirement system. See Superannuation Policy Schedule, chart 2.
- Minimum combined benefit during transition to be at least what people get today but in most cases will be considerably more.
- Capital after 47 years in the workforce for those who make no drawdown on that capital would be approximately $1.8 million or $850,000 in real terms. See Superannuation Policy Schedule, chart 1.
- Government will contribute $30.80 a week, the individual to contribute $30.80 a week and the employer to contribute $15.40 a week, therefore total savings $77.00 a week, $4,000 a year.
- Low-income workers will be able to phase in their contribution with government top-up available.
Will be paid for by a mix of the following:
- Money currently being put aside for retirement fund $2 billion.
- Money currently being used to subsidise KiwiSaver scheme $1½ billion.
- Interest on current fund already put aside for future retirees $1 billion
- Must be invested with organisations that have retirement authority approval.
- A working partner can make contributions on behalf of their partner. (more here)
- [Green Party will] introduce ethical investment guidelines for all Government investment funds. (more here)
- In light of the Saving Working Group’s recommendations and similar moves in Australia, the Green Party will create a public option KiwiSaver fund to lower costs and boost people’s nest egg on retirement.
- To achieve the necessary economies of scale, the fund will be managed by the Guardians of the New Zealand Superannuation Fund — a $16 billion fund.
- The public KiwiSaver option will be one of seven default providers. When KiwiSaver is reviewed in 2014, we will examine the option of making the public fund the sole default provider. (more here)
- Labour’s plan will make KiwiSaver compulsory for every employee aged 18 to 65 from 2014.
- Labour will gradually increase employer contributions at a rate of 0.5 per cent a year, from 3 per cent to 7 per cent, over 9 years.
- Labour will retain the current minimum employee contribution of 2 per cent.
- The $1,000 kick-start will be spread over 5 years. Labour will not make any more changes to the member tax credit.
- Labour will retain the current 65 years eligibility age to access KiwiSaver savings.
- New Zealanders will continue to be able to access their KiwiSaver funds on the grounds of hardship. Hardship grounds will also be applied to allow the suspension of contributions.
- First home buyers will still be able to access their KiwiSaver savings to put towards their first home.
- Labour will review the provisions around migration as part of the tripartite consultation.
- Labour will examine the details and implications for relationship property and bankruptcy as part of the tripartite consultation process. (more here)
Not set out on their website.
Not set out on their website.
- Go ahead with KiwiSaver auto-enrolment in 2014/15 – subject to returning to budget surplus – where people in the workforce not already in the scheme will be signed up with the ability to opt out.
- Increase the minimum KiwiSaver contribution for individuals to three per cent from two per cent from 1 April 2013. This will also be the default rate for new members.
- Increase the employer contribution rate to three per cent from two per cent from 1 April 2013. (more here)
- Make KiwiSaver compulsory. (more here)