National’s agenda to run down KiwiSaver has become even clearer from a scathing critique of the Government’s justification for axing the $1000 kickstart, says Labour’s Finance spokesperson Grant Robertson.
“Since National came to power they have not only continually undermined KiwiSaver with seven cuts in seven years, they have hurt the credibility of the scheme by talking down its effectiveness.
“The nadir came in Treasury’s bizarre regulatory impact statement on cutting the $1000 kickstart in the Budget, which claimed KiwiSaver had not contributed to New Zealand’s net wealth.
“NZIER has revealed the analysis, which came from a joint agency report, only ran from the beginning of KiwiSaver in 2007 to 2010 – a period that includes the global financial crisis when asset prices collapsed – and only used self-reported information and used small sample sizes.
“NZIER says the Treasury analysis didn’t assess the benefits of diversifying risk and ignored lessons from behavioural economics. It also didn’t consider the benefit to young and low-income savers, the diversity of wealth KiwiSaver encourages or that KiwiSaver earns more than income and interest.
“In contrast NZIER concluded that KiwiSaver is likely to lead to an increase in net worth, an increase in standard of living for retired middle and lower income savers and more diversified investments in New Zealand.
“National was scraping the barrel for reasons to cut the kickstart. John Key even claimed IRD said the kickstart cut would not ‘make a blind bit of difference’ to young savers joining up, when the advice was completely the opposite.
“In the July figures KiwiSaver members aged 0 to 17 fell by almost 2000. This was part of July KiwiSaver sign ups being 45 per cent below the monthly average for the previous year.
“With seven cuts in seven years and dodgy data used to justify the latest, it’s clear National is determined to undermine KiwiSaver. Labour is equally determined to see the scheme flourish and all New Zealanders to have the security and independence in retirement that Kiwisaver provides,” Grant Robertson says.