Give Total Rem the flick if KiwiSaver compulsory
KiwiSaver providers want more clarity on how total remuneration packages will be treated with any move towards compulsion.
Tuesday, June 23rd 2026, 6:00AM
National said on Sunday that, if re-elected, it would make KiwiSaver contributions compulsory from 2028, and move to a 12% contribution by 2032.
Koura founder Rupert Carlyon said that would be a significant increased burden on people with total remuneration packages, who are currently funding contributions of 7%.
“Personally I think total rem has got to go.”
Pie Funds chief executive Ana-Marie Lockyer had a similar concern.
“As KiwiSaver moves toward a compulsory model understanding how employer contributions will be treated within remuneration packages will be important for both employers and employees. In addition, the principle of helping more people save is sound, but the implementation details around hardship exemptions, contribution suspensions and support for lower-income households will be important to get right.”
Booster cheif executive Diana Papadopoulos says "proposed higher contributions from both employees and employers would make an even bigger difference to grow the future wealth of New Zealanders, but the issue of total remuneration arrangements needs to be addressed."
"If they’re not used appropriately it can have a really negative impact on people who will miss out on the contributions they deserve."
The Retirement Commission estimates 45% of employers use a total rem arrangement for at least some of its employees.
Kernel founder Dean Anderson agreed the government needed to look at total remuneration agreements. He said it would not be practical for people to lose up to 12 percent of their salary in contributions.
Matt Mackpherson, Sharesies general manager of funds, said it was not clear whether National’s plans included an end to total rem. “These packages go against the spirit of KiwiSaver and employees who receive these packages are not protected by law when minimum contribution levels increase.”
Polling for Simplicity had shown support for compulsion, but economist Shamubeel Eaqub said that was on the basis that it was the employer contributions that were made compulsory.
“My preference would be to make the employer contribution compulsory, keep the employee contribution voluntary and unlink the two.”
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