Labour's KiwiSaver plan includes 7% employer contributions

The party released its savings package today, which also includes resuming contributions to the New Zealand Superannuation Fund.

Rob Hosking
Thu, 27 Oct 2011

Compulsory KiwiSaver – with compulsory employer contributions – and an increased pension age are key features of Labour’s savings policy.

The party released its savings package today, which also includes resuming contributions to the New Zealand Superannuation Fund.

The compulsory KiwiSaver would be for all employees, with employer contributions rising form 3% to 9% over nine years.

Employee contributions, which National is currently raising to 3%, would be dropped to 2%.

Labour’s finance spokesman David Cunliffe said Treasury forecasts were for average wage growth of 3.8% “and 0.5% is only a small part of that.”

The larger pool of savings would also reduce New Zealand's external liabilities, thus reducing interest rates and the exchange rate, he said.

Labour has also grasped the nettle of the pension age, and is promising to lift it from 65 to 67 over 12 years, starting in April 2020.

The pension age, along with the workplace changes, will be developed by “tripartite consultation” between government, employers, and unions.

However Labour leader Phil Goff denied this meant that employees who wanted a say in the issue would have to join a union.

The policies should be seen as part of Labour’s other policies, including a capital gains tax and minimum industry standards, he said.

Rob Hosking
Thu, 27 Oct 2011