English’s bomb­shell is a super-sized gam­ble


Bill English’s pen­sion bomb­shell is a huge po­lit­i­cal gam­ble that could wake up grumpy vot­ers and leave no one happy.

English has tried to sweeten the pill by push­ing out the date when the new re­tire­ment age of 67 kicks in to 2040.

But rather than make it eas­ier to swal­low, it could stoke the fires of the war al­ready rag­ing be­tween younger vot­ers and the baby boomers over stu­dent loans and sky­rock­et­ing house prices.

The take out for younger vot­ers from English’s an­nounce­ment is that Na­tional doesn’t want to alien­ate the pow­er­ful boomer bloc so is tar­get­ing so­called gen­er­a­tion rent in­stead.

That’s the group that al­ready feel that they have been un­fairly sad­dled with stu­dent debt and priced out of the hous­ing mar­ket by baby boomers re­ly­ing on prop­erty to fund their re­tire­ment.

Now they’re be­ing told they must sup­port the boomers in re­tire­ment while know­ing they will have to work longer them­selves. But English is not just court­ing a back­lash from younger vot­ers.

An­drew Lit­tle can tell him what hap­pens when you rile the grey vote by tin­ker­ing with the pen­sion.

When Labour pro­posed raising the re­tire­ment age at the last elec­tion it stirred up the most fear among older vot­ers who were al­ready at or close to re­tire­ment age and weren’t even af­fected by the change.

That’s the legacy of a gen­er­a­tion of dis­trust be­tween politi­cians and older vot­ers who re­mem­ber a string of bro­ken prom­ises on pen­sions.

That was the rea­son for John Key’s prom­ise to re­sign as prime min­is­ter rather than fid­dle with pen­sions; he felt that Na­tional was so mis­trusted among older vot­ers it was al­most un­electable.

So why is English grab­bing the pen­sion tiger by the tail?

It will prob­a­bly get a luke­warm wel­come from econ­o­mists and the likes of Trea­sury, who have long ar­gued that pen­sions are un­sus­tain­able.

But the changes are so far out in the fu­ture that English will more likely be crit­i­cised for not mov­ing soon enough.

English may also be bank­ing on vot­ers see­ing this as a fis­cally re­spon­si­ble and nec­es­sary - if un­pop­u­lar - move. But as Labour found at the last elec­tion, get­ting ku­dos for mak­ing the tough de­ci­sions on pen­sions doesn’t trans­late into votes.


Prime Min­is­ter Bill English an­nounced the changes to na­tional superannuation at Par­lia­ment on Mon­day.

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