Forget about personality; Labour's policy has balls
I’ve said it before and yesterday’s savings policy announcement from Labour demonstrates it again. Labour understands savings issues far more than National. Its package is potentially a circuit breaker for this year’s election and will get people talking.
Friday, October 28th 2011, 6:38AM 5 Comments
Raising the age of entitlement for NZ Super is a no-brainer. It has to happen. Good on Phil Goff and the Labour Party for being prepared to address this issue. Sure the increases it talks about are pretty small, but at least it is starting the process off and that is the hardest part. John Key’s pledge to resign rather than change the entitlement is one of the most stupid policy things he has ever said. Making KiwiSaver compulsory isn’t as clear cut. You would think that fund managers and the savings industry will be rushing to party vote Labour. After all such a move helps to underpin their businesses and for advisers it’s a huge plus as regulation has made it harder for new competitors to set up shop. I must admit the comments former finance minister Michael Cullen used to make about compulsory super still echo with me. His line was that compulsory super was the state going too far and interfering with people’s rights and decisions. Again an odd comment from someone on the left of politics. He is right, but then there are bigger issues and trends to consider. With trends New Zealand for years has bucked what you could say are the international norms around savings policies. That is all changing now and compulsory super is part of the big package. Unfortunately the government has some idea that we should be getting closer and closer to Australia on savings issues. Compulsory super is one of those things that is likely to happen over time anyway. It is, though, frustrating that this is more tinkering with KiwiSaver. It was inevitable that politicians just wouldn’t leave it alone. There are many other parts to Labour’s policy worth exploring, and we will do that later. The funny thing is that many of the things it is campaigning on you would expect to see from a more conservative party than Labour. A comment I read yesterday summed it up. “Holy cow - now I'm really confused. I'm as right-leaning as they come, but now I'm wondering whether I should consider voting Labour?! Raising the retirement age is so obviously needed it's not funny, and a capital gains tax makes a lot of sense.” I suspect those comments will be shared by many others in the savings industry today too.
You can read Philip's blog here: http://www.goodreturns.co.nz/blog/
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