Posts Tagged ‘retirement age’

National guts Kiwisaver

13 August 2013 4 comments


Released today at the National Party annual conference in nelson;


National tackles first home affordability

Source: NZ Herald – National tackles first home affordability


Kiwisaver was set up in July 2007 by Labour Finance Minister, Michael Cullen, to motivate New Zealanders to save for their retirement. Our Aussie cuzzies already have about A$1.3 trillion saved in their compulsory super schemes – we are lagging way behind.

“After more than a decade of compulsory contributions, Australian workers have over $1.28 trillion in superannuation assets. Australians now have more money invested in managed funds per capita than any other economy.” Source

A similar scheme, implemented by the Norman Kirk-led Labour government in 1973, was scrapped by National’s then-Prime minister, Robert Muldoon, in 1975. National has a horrendous track record when it comes to planning and motivating New Zealanders to save for retirement.

Instead of saving for retirement, we tend to invest in “bricks and mortar” – rental properties. This is not saving as it relies heavily on borrowing from overseas lenders to finance. Those borrowings are other peoples’ savings.

So in effect we are borrowing other peoples’ savings to invest in rental properties which we are using for our retirement “savings” – other peoples’ savings being used to build up our own “savings”.

This is not just “false wealth” and damaging to our economy (those borrowings have to be re-paid eventually) – it is sheer economic lunacy on a grand scale. Note the green line in the chart below – it is private debt incurred from overseas;




And the National Party turns a blind eye to it.

As a result, our savings is meagre enough as it is.

The ANZ and ASB summed it up with brutal reality,

ASB’s executive general manager wealth and insurance Blair Turnball said someone who wanted to live off $40,000 a year needed to retire with a pool of around $600,000 if they wanted to make it last for 25 years – the timeframe in which people felt they could live beyond the retirement age.

“This [$70,000] is $530,000 less than the average respondent in our survey aspired to, and only 55 per cent of the aspiration annual $40,000 income. It is alarming how big the gap is.”

Source: NZ Herald – Kiwis ‘not saving enough to retire on’

John Body, managing director ANZ Wealth and Private Banking New Zealand, said New Zealanders were saving around 2 to 3 per cent of their take-home pay whereas Australians were saving 9 per cent and many in Asia were saving 12 per cent.

“We are just not saving enough.”

Source: IBID

For Key and his incompetant  government to allow New Zealanders to tap into their Kiwisaver funds undermines the very purpose for it. In fact, he’s made the situation, as outlined by the ANZ and ASB, even worse.

We’re back to square one; people investing in bricks and mortar instead of saving for their retirement.

There are other ways to get Kiwis into their first homes without subverting Kiwisaver. National apparently chooses not to consider any of them.

In July 2008, Key made this public pledge,

“There won’t be radical changes. There will be some modest changes to KiwiSaver.”

Source: NBR –  Key signals ‘modest changes’ to KiwiSaver

This most certainly constitutes a radical departure from Kiwisaver’s original intent.

Allowing people to withdraw from their Kiwisaver savings account to invest in housing may work for the very short term; Key has “solved” a potential election nightmare for himself and his Party.

But for the future of this country, and the hundreds of thousands of baby-boomers soon to hit retirement – he has left us a ticking time-bomb.

Political expediency wins out again.

This blogpost was first published on The Daily Blog on 12 August 2013.



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Citizen A – 31 May 2012 – Online now!


Citizen A


– 31 May 2012 –


– Matthew Hooton & Phoebe Fletcher



Issue 1 – Key senses danger and backs down on classroom sizes. Keen political instincts or self inflicted mutilation?

Issue 2 – Raising retirement. Economic sense or more baby boomer intergenerational theft?

Issue 3 – Tame Iti get’s two and a half years, Rena captain gets seven months . What have we learned from the Urewera terrorism trials?


Acknowledgement (republished with kind permission)




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The Great New Zealand Scam

19 November 2011 1 comment



Never mind Nigerian scammers – we have something much closer to home, and is the biggest rort ever. What do retirement policies and asset sales have in common? Plenty!


Full Story


One commentator to the story above posted this message on Stuff’s messageboard,

cm   #47   11:48 pm Nov 18 2011

All this shows is who votes, and in numbers.

the boomers stand to loose the most from a retirement age increase. The boomers stand to gain the most from asset sales.

come on gen y, x, z what ever the demographs call you. get out and vote before the baby boomers (your own parents/grandparents) sell you and your future out. its pretty damn simple, if you over 20 you arnt a child anymore, your an adult. so act like you give a damn about your futures and stop believing the bullshit that your parents will look after you, put that on a tui bill board.


CM has pretty well identified how Baby Boomers are going to “internalise a complicated situation” by voting National even though, on the surface, they have an alleged dislike of asset sales.

It is a perfect analysis of what is about to happen on 26 November: the Baby Boomer generation is about to ‘steal’ property from the next generation, for their own gain.

Instead of our generation paying it’s way through taxation, we’ve voted tax cuts for ourselves (2009, 2010) and big borrowings from overseas to sustain those tax cuts, and maintain social services. Then, to start paying it back, instead of doing it through taxation, we’ll sell off state assets. End result; we get the benefits, and Gen X, Y, etc, are left with $13 billion in student debt and not much more to show for it.

By the way, John Key and many others in his position had the benefit of a free tertiary education – fully tax-payer funded. With a student allowance on top, to make it all as easy as possible.

Then, through two tax cuts, he voted himself an extra $1000 a week.

Meanwhile, our young folk are accumulating more and more student debt. By last year, the student debt mountain has grown to an unfeasible $13.9 billion.

What a racket! This is ‘better’ than a Ponzi Scheme! It’s better than a Nigerian scam – because it’s all totally legal.

This is why our best and brightest young people are heading overseas.  They’re leaving before they get saddled with the bill for looking after us in our retirement.

Unfortunately, Labour’s policy to make sure disengaged youth are heard may be too little, too late. Our children are already disconnected from us and our society because we made damn sure it happened that way. Saddling our young folk with a debt we (Baby Boomers) never had to face is pretty well telling them, “Kid, you’re on your own!”.

All I’ll say to Gen Xers and Yers is: Run! (Though Baby Boomers – through the government – won’t let you get away quite so easily.)


Additional reading

Student loans – the debt mountain

Govt may use student loan debt collectors abroad

Greed is Good?