tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Thursday, August 13th, 9:40PM

News

rss
Latest Headlines

English announces KiwiSaver soft-compulsion plans

The Government is to proceed with KiwiSaver auto-enrolment in 2014/15 - subject to returning to surplus - said Finance Minister Bill English.

Tuesday, October 18th 2011, 3:00PM 2 Comments

He said the Government needed to be mindful of the cost of all programmes so KiwiSaver auto-enrolment would commence "in the same fiscal year in which we return to surplus and start to repay debt."

"As we signaled in the Budget, we believe there is merit in a one-off KiwiSaver auto-enrolment exercise, where people in the workforce not already in the scheme would be signed up with the ability to opt out."

Government estimates that auto-enrolment would attract between 200,000 and 275,000 new members to KiwiSaver at a cost of up to $550 million over four years.

English said the Government had rejected auto-enrolment before 2014/15 as the immediate focus was on returning to budget surplus.

"While we're running deficits in the next two years, that's money the government would have to borrow. Borrowing money to put into KiwiSaver accounts is not real savings - we are applying the same approach to resuming contributions to the Super Fund," he said.

"Depending on uptake and design, officials estimate a KiwiSaver auto-enrolment could cost the Government up to $550 million over four years - including the one-off $1,000 kick start payments to new members and ongoing annual member tax credits. We intend to fund this from within existing budget allowances."

English said the Government agreed with the Savings Working Group that a compulsory savings regime is not warranted.

"Many New Zealanders have already opted out of KiwiSaver because they have valid reasons for not saving for retirement right now - including paying off their mortgage or being members of private savings schemes."

Details of the auto-enrolment framework are to be finalised next year after the Government considers submissions on a public discussion paper to be issued in early 2012.

« Advisers offered flexible currency productKiwiSaver mismatch a 'huge challenge' for advisers »

Special Offers

Comments from our readers

On 21 October 2011 at 5:53 pm Michael Donovan said:
Kiwisaver is not needing to be made compulsory..!

You just instil a savings habit into "young" people while real young at primary school...just like we did every Wednesday into our "squirrel" Post Office savings account.

Then ...later in life the savings habit is nothing much different than the "habit" formed where we still wash our hands after the toilet....automatically.

It used to work real good....and savers were the main.
Why on earth did they change it and stop something that worked well???
Michael Donovan
On 26 October 2011 at 8:49 am David van Schaardenburg said:
A couple of meaningful enhancements to the proposed autoenrolment process would be;

1. Get rid of the default funds ahead of this - they are anti competitive and are not designed for long term savers.
2. Stagger the Kickstart payment over 4 years with the payments being reliant on ongoing contributions by the KiwiSaver member.
Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
  • It starts with governance
    “Thanks JP, if we know what the rules are we can follow them, if we know what the solutions are we can implement them....”
    14 hours ago by Adviser1
  • Record gold prices 'could go higher'
    “Happy to be made wiser by Gold aficionados, but this years Gold rally seems one of the unexpected and possibly irrational...”
    14 hours ago by Davidvs
  • It starts with governance
    “Hi JP, good analogy of what would be a sensible way to approach the new landscape for March 2021. Governance does not have...”
    18 hours ago by gavin austin adviser business compliance
  • It starts with governance
    “@Adviser1 this is part of the discussion we need to have as an industry. It is also part of the message we have with the...”
    2 days ago by JPHale
  • It starts with governance
    “Thanks Gavin, appreciate your comments. So by engaging a compliance consultant and having the necessary policies, procedures...”
    2 days ago by Adviser1
Subscribe Now

Weekly Wrap

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.15 3.25 3.39
ANZ Special - 2.55 2.69 2.79
ASB Bank 4.45 2.55 2.69 2.79
Bluestone 3.49 3.49 3.49 3.49
BNZ - Classic - 2.55 2.69 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.15 3.29 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 5.50 - - -
Lender Flt 1yr 2yr 3yr
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 ▼3.85 ▼3.95 -
HSBC Premier 4.49 2.45 2.60 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 3.69 2.55 2.65 2.79
Kainga Ora 4.43 ▼2.93 ▼3.07 ▼3.24
Kiwibank 3.40 3.30 3.54 3.54
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.55 2.79 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.45 2.99 3.35
SBS Bank 4.54 ▼3.05 3.19 ▼3.25
Lender Flt 1yr 2yr 3yr
SBS Bank Special - ▼2.55 2.69 ▼2.75
The Co-operative Bank - Owner Occ 4.40 2.55 2.69 ▼2.79
The Co-operative Bank - Standard 4.40 3.05 3.19 ▼3.29
TSB Bank 5.34 3.35 3.49 3.79
TSB Special 4.54 2.55 2.69 2.99
Wairarapa Building Society 4.99 3.65 3.69 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - 2.55 2.69 2.79
Median 4.55 3.05 3.13 3.12

Last updated: 11 August 2020 8:24am

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