About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   depositrates.co.nz  |   landlords.co.nz
Last Article Uploaded: Tuesday, March 31st, 1:42PM
rss
Latest Headlines

What is the super fund?

Questions have been raised over the accounting treatment of the Government's proposed super fund.

Friday, February 23rd 2001, 3:51PM

by Rob Hosking

Is the government’s proposed superannuation fund an expense or a capital item?

That issue was the subject of a major spat between Minister of Finance Michael Cullen and National finance spokesman Bill English at this week’s finance and expenditure select committee meeting.

Cullen has been saying since late last year that the fund should be included as an additional expense on the government’s balance sheet.

The problem with this, he told MPs, was to do so would not meet GAAP accounting standards, which would require the fund to be listed as a capital item.

"In common sense terms, I would prefer to see it listed as part of government spending," Cullen said.

Under the GAAP standards, transfers to the fund would be treated as a capital item and offset by the asset being built up.

"I think that while that is correct in accounting terms in common sense terms it's being a bit cute," Cullen said. "It does raise the possibility you could borrow the whole lot and transfer it to the fund."

That comment drew fire from the National opposition because of its implications for the official size of the government sector.

The Labour Alliance regime has a target of 35% of GDP for the size of the state sector, compared to the target of 30% which held for much of the previous nine years under National.

The current level is about half way between the two. However if the superannuation fund is treated as the GAAP standards say it should, the Labour Alliance government is unlikely to reach that target without a considerable rise in government spending.

That was English’s target.

"Treasury uses a definition in accordance with well-established accounting rules designed to promote transparency," he said. "Cullen's own personal definition is intended to avoid the embarrassment Labour would feel by announcing it had reduced its government spending target.

"Over the next four years, the difference between the two is $6.5 billion, almost as big as the whole health budget."

The government will, in this year’s Budget, be more explicit about the discrepancy, Cullen said, although he gave no details of how this would be achieved.

Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.

« Greens outline their view on ethical investmentAMP & Good Returns launch superannuation website »

Special Offers

Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
  • What is the value of CPD?
    “What all this discussion says to me is that there seems to be a lot of emphasis on doing CPD to meet the requirements of...”
    7 hours ago by Brent Sheather
  • What is the value of CPD?
    “David - so in your words " Where does a Risk Specialist AFA go for relevant CPD material? Company product launches don't...”
    1 day ago by gavin austin adviser business compliance
  • Clients complain about adviser fees
    “It is interesting to note that in the article, FSCL state they receive 2 or 3 similar complaints a month. Nothing wrong with...”
    1 day ago by Another AFA
  • What is the value of CPD?
    “I must say I like Gavin's idea of the " FMA to have some intestinal fortitude to go and audit him and publish the results",...”
    1 day ago by R1
  • What is the value of CPD?
    “With respect Pragmatic and JM, in this instance, G.Lindsay's point is fair. Where does a Risk Specialist AFA go for relevant...”
    3 days ago by dcwhyte
Subscribe Now

News and information about KiwiSaver

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 6.74 5.89 5.99 6.29
ANZ Special - 5.39 5.39 5.79
ASB Bank 6.75 5.99 5.99 6.39
ASB Bank Special - 5.59 5.39 5.59
BankDirect 6.75 5.99 6.09 6.39
BankDirect Special - 5.59 5.39 5.59
BNZ - Classic - 5.69 5.39 5.59
BNZ - Mortgage One 7.15 - - -
BNZ - Rapid Repay 6.74 - - -
BNZ - Std, FlyBuys 6.74 5.89 6.19 6.29
BNZ - TotalMoney 6.74 - - -
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 6.70 - - -
Credit Union Baywide 6.45 5.95 5.99 -
Credit Union North 6.45 - - -
Credit Union South 5.75 - - -
eMortgage 6.04 6.15 6.69 7.19
Finance Direct 6.10 6.45 6.69 7.10
First Credit Union 6.45 - - -
General Finance 5.95 6.25 6.50 7.10
HBS Bank 6.65 5.69 5.39 5.69
HBS Special - 5.59 5.19 5.49
Heartland 6.70 7.00 7.25 7.85
Lender Flt 1yr 2yr 3yr
Heretaunga Building Society 6.70 5.70 5.40 -
Housing NZ Corp 6.74 5.70 ▼5.99 6.29
HSBC Premier 6.84 5.65 5.65 5.65
HSBC Premier LVR > 80% - - - -
HSBC Special - 5.29 5.29 5.29
ICBC 6.75 5.99 6.39 -
Kiwibank 6.65 5.69 6.09 6.29
Kiwibank - Capped - - - -
Kiwibank - Offset 6.55 - - -
Kiwibank Special - - ▼5.39 5.55
Liberty - - - -
Lender Flt 1yr 2yr 3yr
Napier Building Society 5.80 6.00 6.70 -
Nelson Building Society 6.95 6.15 6.60 -
NZ Home Loans 6.85 6.09 6.40 6.65
Perpetual Trust 7.70 - - -
Resimac 6.59 5.92 5.95 6.04
SBS Bank 6.65 5.69 5.39 5.69
SBS Bank Special - 5.59 5.19 5.49
Silver Fern 5.95 6.10 6.55 7.05
Sovereign 6.85 5.99 6.09 6.39
Sovereign Special - 5.59 5.39 5.59
The Co-operative Bank 6.70 5.59 5.39 5.59
Lender Flt 1yr 2yr 3yr
TSB Bank 6.74 5.70 5.70 6.00
TSB Special - - 5.35 5.60
Wairarapa Building Society 6.20 5.75 5.95 -
Westpac 6.59 5.99 ▼5.99 ▼5.99
Westpac - Capped rates - 6.74 6.99 -
Westpac - Offset 6.59 - - -
Westpac Special - - 5.39 5.89
Median 6.70 5.89 5.97 5.99

Last updated: 31 March 2015 11:13am

News Quiz

Who's ceo has just received the 2015 Women’s Empowerment Principles (WEP) CEO Leadership Award in a ceremony at the UN headquarters in New York, being only the second NZ ceo chosen for the honour?

Sovereign

Fisher Funds

Partners Life

Fidelity Life

MORE QUIZZES »

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by PHP Developer and eyelovedesign.com