Super bill slowed down

The Government's new superannuation fund will be established on July 1 although legislation enabling the fund won't be passed through Parliament by then.

The chair of the Finance and Expenditure Select Committee Mark Peck told a Funds Management conference in Auckland yesterday that there will be some opposition to the bill, however he is confident it will be passed.

National's super spokesman Bill English is in discussion with the bill's architect and Finance Minister Michael Cullen, however Act's finance spokesman hasn't taken up offers to discuss the bill.

Peck says 29 substantive submissions were made to the committee on the bill.

He says because the bill won't be passed transitional arrangements are being made for managing the money. Under these arrangements the Treasury's Debt Management Office will look after the funds.

The Government has projected to put $600 million into the fund in its first year.

The hardest question for the Government will be the appointment of the board because it will be done at a double-arms length process.

Peck says this will be difficult because it is a whole new process for the Government.

Normally nominations for state-owned enterprise board members go straight to Cabinet for approval. With the super fund the nominations will go to an independent committee then to Cabinet.

"It's a change in political culture," he says.

Guardian Trust Funds Management managing director Anthony Quirk says appointments will be difficult because New Zealand is small, there is a dearth of candidates and the potential for conflicts of interest.

He also says the Government will need to be careful to get a good balance on the board between the various interest groups.

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