KiwiSaver is unfinished business, Labour’s finance spokesperson Barbara Edmonds says, but what the party won’t be looking at, is changing the superannuation age.
During a question and answer session with facilitator and TVNZ former business correspondent Katie Bradford at the Financial Services Council Conference on Thursday, Edmonds said while she would not give away the party’s policy, Labour believed there were a lot of settings and a lot of inequity that needed to be dealt with first.
“Actively you could look at contribution rates, you could look at the way that KiwiSaver is taxed and actually other ways that savings are taxed,” Edmonds said.
“There are different elements to it that we believe that we need to have a good look at to actually get to that vision that Sir Michael Cullen was looking at.”
Just yesterday, Finance Minister Nicola Willis said at the same conference that although she was cynical about whether there could be conversations with Labour about superannuation settings, “if we can get a consensus that results in enduring change, that is the most stable thing for everyone involved”.
When asked if Labour would be willing to work with National and other parties on it, Edmonds said Willis had previously offered to have a conversation around superannuation and retirement settings.
“I was more than willing to have that chat. The kind of claim I think Willis spun to me was looking at lifting the superannuation age. Labour has been really clear on that. We’re not looking to lift the superannuation age.”
Edmonds said she was still willing to have a conversation with Willis and would wait for an invitation, as there were still areas for discussion that could be had between parties.
This included settings within the retirement system and savings settings, she said.
Edmonds also brought up the Retirement Commission and Hnry’s recent joint report on sole traders and what incentives were there for the self-employed to enter KiwiSaver.
The joint report found: “The evidence points to a clear gap in engagement, driven by financial strain, lack of automatic enrolment, limited awareness of incentives, and the absence of employer contributions.”
“These factors are compounded by recent changes to KiwiSaver settings announced in Budget 2025, which may further discourage participation among lower-income earners,” the report said.
Edmonds said even though Labour didn't want to increase the age of super, there were a whole bunch of settings that could be looked at with other parties.
“Short-term decisions for long-term prosperity don’t actually help the situation.”
When asked if she was worried about political parties talking about “tinkering” with KiwiSaver, for example allowing early withdrawals for things like purchasing farms, Edmonds said she disagreed with tinkering.
“Again, short-term decisions for a long-term policy that has realised gains at a later date - short-term decisions don’t help.”
Bradford brought up New Zealand First’s proposal to increase employer and employee contributions to 10% and to make it compulsory. She asked Edmonds what she thought the ideal contribution rate was.
Edmonds said the ideal contribution rate is set out in increments and there’s clarity and certainty when those contribution rates increase.
This would allow businesses to be prepared, she said.
“If we’re going to look at contribution rates, you have to provide certainty and as we’ve seen across Australia, increments over time, not just overnight, because there will be equity issues with that.”
Edmonds also brought up total remuneration packages and said Labour had previousy had a Bill in the House about this.
The discussion around remuneration packages is back in the spotlight as KiwiSaver providers and the Retirement Commission told RNZ a simple improvement to KiwiSaver would be banning employers from putting KiwiSaver contributions into a total remuneration package.
So instead of receiving your employer contribution as part of your salary, it would be on top of your salary.
When asked by Bradford if conversations were had with other political parties whether the remuneration package needs to be looked at, Edmonds said she thought it was part of the discussion that needs to be had.
Edmonds said she was conscious that businesses did total remuneration packages because it was more affordable.
“It’s not just around age or contribution or how you pay for it. You have to look at the full consequences of it.”
Edmonds said the Labour Party will make more announcements, including one on tax, before the end of the year.
Superannuation and KiwiSaver
With an election next year, political parties have signalled potential changes to KiwiSaver and superannuation.
Speaking at the same conference on Tuesday, Finance Minister Nicola Willis told the audience: [I’m] always respectful of my caucus, but able to commit that we will go to the next election with a superannuation and savings policy … KiwiSaver has to be part of that.”
At New Zealand First’s annual general meeting in Palmerston North last weekend, Winston Peters announced the party’s proposal to increase both employee and employer contributions to initially 8% and then later to 10%.
KiwiSavers and employers would receive tax cuts to cover the increases, Peters said.
KiwiSaver rules
Following this year’s Budget, people aged 16 and 17 are now eligible for KiwiSaver so they can access employer and government contributions.
The Government’s contribution rate has gone down to 25 cents for each dollar a member contributes. This was previously 50 cents for each dollar, which meant receiving a maximum government contribution of $521.43.
To get the Government’s full contribution now, which is $260.72, people need to put in at least $1042.86 of their own money between July 1 to June 30 each year.
Alongside this, people with an income of more than $180,000 will no longer receive the government contribution.
Employer and employee contribution rates will increase to 3.5% from April 2026. This will move to 4% in April 2028.
It’s currently at 3% - KiwiSaver members can choose to stay at the current 3% rate and still be matched at this rate by their employer.
6 Comments
Nobody will raise the super age. The only way it would increase is bipartisan support over all parties with representation in parliament and Labour's Maori Caucus would kill it before the 6pm news.
'With an election next year, political parties have signaled potential changes to KiwiSaver and superannuation.' I'm slightly optimistic that there could be some thinking going on behind the scenes... but I guess that it's mostly if we do such and such we can increase our votes in 2026 by 5%...and that's about cutting the cloth to fit lowering revenue, or increasing taxation, or borrowing to gain votes and political power knowingly shafting young peoples future opportunities and standard of living.
The subsidy for the Parliamentary Superannuation Schemes is 20% of the gross salary payable to a backbencher.
Mandy - the next time you correspond with Willis and others can you please ask them how they think this is fair and when they will change the legislation (under urgency)?
Yes and if I was just entering the work force I certainly would not be joining Kiwi Saver run by the Govt. I would expand my financial literacy and look after my own money
Once you'd expanded your financial literacy, how would you think about your employer offering you an extra ~2% (soon to rise) on your salary if you sign up to Kiwisaver?
My advice is always to join Kiwisaver to maximise the benefits, and all your savings beyond that level go somewhere else where you have more control.
Labour sucking the oxygen away from Winston first.
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