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KiwiSaver ad labelled misleading

The Labour Party has had a rap over the knuckles for an advertisement which suggests, to some, that KiwiSaver is government guaranteed.

Wednesday, August 29th 2007, 7:06AM
A complaint was made to the Advertising Standards Complaints Board (ASCB) that the phrase "KiwiSaver + New Zealand Super / Labour's guarantee for your retirement" was misleading and suggested there was a government guarantee for the scheme.

However, KiwiSaver is not government guaranteed as it provided by a third party. The government has publicly stated that there is no government guarantee for the KiwiSaver scheme.

In its response Labour argued that "the phrase…is a statement of a policy guarantee that has been made by the Labour Government."

"The phrase referred to by the complainant is truthful. The Labour Government has repeatedly stated that it will guarantee the future of the KiwiSaver scheme and New Zealand Superannuation as the basis of New Zealand's system of retirement provision.

"There is no suggestion in the advertisement that the returns from the KiwiSaver scheme are `government guaranteed', and in fact there is no use of the word `government' in the advertisement at all."

In a split decision a minority of the ASCB Board agreed that the statement made in the advertisement was a statement of policy by a political party and that the advertisement was not misleading and therefore not in breach of the rules.

However, a majority disagreed. "(The ad) stated that the use of the word "guarantee" without further qualification in reference to a scheme that dealt with the financial security of consumers contained a level of ambiguity that was likely to mislead. The linkage of KiwiSaver with New Zealand Super was, in the opinion of the majority likely to convey an overall impression of guaranteed financial security."

Finance Minister Michael Cullen accepted the majority decision.

"Someone not familiar with the details of KiwiSaver might draw the conclusion that there was a government guarantee for their individual savings when there is not," he said.

Cullen says while Labour had made its position clear National has consistently refused to outline its position.

"National has constantly hinted that it would scrap at least part of KiwiSaver to fund tax cuts. And further, it has said that the provision of superannuation in this country is too generous, which suggests that even New Zealand Superannuation is under threat."

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