Can I rely on a state pension?
NEW Zealand Superannuation (NZ Super) is a pension paid by the state to most New Zealand residents from age 65 until death.
To be eligible for NZ Super you need to be aged 65 or over and a legal resident of New Zealand, having lived here for 10 years since age 20. Five of those years have to be since you turned age 50.
If you are close to retirement and want to know more precisely the level of New Zealand Superannuation you would be entitled to (and information about supplements, overseas pension issues, etc) contact Work and Income on 0800 552 002 or visit www.workandincome.govt.nz.
The level of payment is reviewed each year and is adjusted to take account of increases in cost of living (inflation) and wages. When wages increase, NZ Super is adjusted so that it stays between 66 per cent to 72.5 per cent of average ordinary time earnings after tax. This means for couples both over 65, their pensions, after tax, will not fall below 66 per cent of the average ordinary time wage after tax. For single people the pension is about 40 per cent of that average wage.
No, future pension payments are not guaranteed, but Parliament needs to approve any significant change. New Zealand has had a form of state-funded retirement income for over 100 years. Eligibility, payment levels and other conditions have changed many times over that period. The changes have reflected different political views as well as changes in society, economy, the labour market and other factors. The present government’s policy is to retain the existing entitlements for the foreseeable future. Comments from other major parties suggest that changes for people in and near retirement are unlikely. However, there are aspects of retirement income policy which continue to be debated. As governments change and society’s views change no one can rule out the possibility of amendments.