A claim by John Key that cutting the KiwiSaver kickstart “will not make a blind bit of difference to the number of people who join KiwiSaver” has been shown to be false in Budget documents released yesterday, says Labour’s Finance spokesperson Grant Robertson.
“The papers reveal the Inland Revenue advised the Government that cutting the kickstart would lead to ‘lower numbers of KiwiSaver members among the self-employed and children’. Despite this advice, the Prime Minister was happy to tell Parliament the ‘formal advice’ from IRD had told him the opposite.
“Since that cut to kickstart the ANZ has announced there has been a 50 per cent fall in sign-ups to their Kiwisaver scheme, one of the largest in New Zealand.
“This completely validates the IRD’s advice. National claims the policy saves more than $500 million over four years. That means hundreds of thousands of fewer new savers who won’t sign up to KiwiSaver as they don’t get the kick-start.
“The removal of kick-start has undermined the country’s confidence in the scheme. The ANZ survey shows that 52 per cent of New Zealanders are concerned the Government will make further changes. New Zealanders have every right to feel this way given the cuts National has already made.
“The Government was also given the option of retaining the kickstart for under-18’s, but they rejected that. They claimed the cuts to KiwiSaver were needed to use the funds for ‘higher priority spending’ which apparently includes a $26 million flag referendum.
“Building a savings culture is surely more important the Prime Minister’s vanity flag project,” says Grant Robertson.