About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   depositrates.co.nz  |   landlords.co.nz
Last Article Uploaded: Monday, May 29th, 10:20AM
rss
Latest Headlines

Cullen Fund Makes No Sense: Brash

National Party candidate Don Brash argues against the Cullen Fund.

Tuesday, July 23rd 2002, 10:10PM

"The Labour/Alliance Government's promotion of the fundamentally-flawed Cullen Fund as its answer to New Zealanders' future retirement needs is a serious mistake," says National Party candidate Don Brash.

Dr Brash told the annual convention of the Financial Planners and Investment Advisers Association today that the Cullen Fund made little sense.

"It is not clear to me why it makes sense for the Government to be investing in overseas shares and bonds, while at the same time increasing its borrowing in New Zealand.

"No fund manager worth their salt would advise a private individual to invest in overseas shares before the individual's home mortgage has been repaid. No investment in overseas shares can give a risk-adjusted after tax rate of return equivalent to the return gained from retiring debt.

"Why then does it make sense for Government to invest overseas before retiring its debt - indeed while still increasing its debt?"

Dr Brash says because the Cullen Fund will absorb large amounts of cash for a number of years, at a time when the Government is also undertaking a substantial investment programme, it will have to borrow substantially more than would otherwise be the case.

"The Government has marketed the Cullen Fund as in some way providing a high degree of certainty for funding future superannuation. But it will only make a small contribution - providing around 10%t of the cost of NZ Superannuation over the years the fund will be drawn down.

"However, by creating the illusion of certainty the Cullen Fund may well have a quite perverse effect on private sector saving behaviour. Treasury warned the Government of this risk when the scheme was first being discussed and there are signs it may already be having this effect.

Dr Brash says the fundamental ability to pay for New Zealand Superannuation in 20 or 30 years' time depends on the size of the economy at the time.

"If it was really such a good idea to fund future Government spending by investing in overseas sharemarkets, somebody would surely have thought of it long ago. The Cullen Fund looks like a serious mistake to me."

This is a press release from the National Party

« Super not a done deal: CullenAMP & Good Returns launch superannuation website »

Special Offers

Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
  • InvestNow mix-up disappointing: Stubbs
    “Bobby is right. Simplicity is a reporting entity for AML/CFT. They can rely on a third party for CDD/EDD etc, but they need...”
    16 minutes ago by Barry Read
  • InvestNow mix-up disappointing: Stubbs
    “No Murray. Simplicity need to know where the money is coming from. The rules don't say they can just make an assumption....”
    1 day ago by Bobby
  • Insurers want tweaks to client-first duty
    “Curious to see Partners Life seeking a tightening of replacement rules after seeding its business with business rolled from...”
    3 days ago by paulgogol
  • InvestNow mix-up disappointing: Stubbs
    “I heard Simplicity's recent wealth innovation tour and excited about it. What are the timeline to reduce the minimum investment...”
    3 days ago by ramanan3012
  • InvestNow mix-up disappointing: Stubbs
    “@bobby I think you have got the wrong end of the stick. The issue isn't AML as you think and suggest. Rather more likely...”
    3 days ago by Murray Weatherston
Subscribe Now

News and information about KiwiSaver

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.79 4.99 5.35 5.59
ANZ Special - 4.49 4.85 -
ASB Bank 5.80 4.85 5.14 5.49
ASB Bank Special - 4.45 4.74 5.09
BankDirect 5.80 4.85 5.14 5.49
BankDirect Special - 4.45 4.74 5.09
BNZ - Mortgage One 6.50 - - -
BNZ - Rapid Repay 5.95 - - -
BNZ - Special - 4.59 4.79 5.09
BNZ - Std, FlyBuys 5.90 4.99 5.19 5.49
BNZ - TotalMoney 5.90 - - -
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 6.70 - - -
Credit Union Baywide 5.95 5.10 5.25 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 5.00 5.20 -
Housing NZ Corp 5.79 ▼4.85 5.14 5.49
HSBC Premier 5.79 4.09 4.29 4.89
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 5.70 4.59 4.69 5.09
Kiwibank 5.70 5.09 5.19 5.65
Kiwibank - Capped - - - -
Kiwibank - Offset 5.70 - - -
Kiwibank Special - 4.69 4.79 5.25
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 6.10 5.10 5.45 -
Resimac 5.00 4.86 4.75 5.30
Lender Flt 1yr 2yr 3yr
SBS Bank 5.79 4.99 ▲5.29 ▲5.59
SBS Bank Special - 4.59 ▲4.85 5.25
Sovereign 5.90 4.85 5.14 5.49
Sovereign Special - 4.45 4.74 5.09
The Co-operative Bank - Owner Occ 5.75 4.59 4.85 5.25
The Co-operative Bank - Standard 5.75 5.09 5.35 5.75
TSB Bank 5.65 4.80 5.15 5.45
TSB Special - 4.55 4.75 5.15
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.84 4.99 5.29 5.59
Westpac - Capped rates - 5.15 5.25 -
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.84 - - -
Westpac Special - 4.59 4.85 5.09
Median 5.80 4.85 5.14 5.38

Last updated: 29 May 2017 10:18am

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

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