What’s killing our sav­ings plan?


Ki­wiSaver. It’s a New Zealand trea­sure.

In­tro­duced by the Clark Labour Govern­ment in 2007, Ki­wiSaver was part of a for­ward­think­ing plan to make sure we will all be able to live a com­fort­able re­tire­ment.

It wasn’t a pol­icy for the here­and-now. It was, typ­i­cally for that Govern­ment, a pol­icy for the fu­ture. Its great­est im­pact was al­ways go­ing to be felt long af­ter the mem­bers of that Govern­ment had de­parted from po­lit­i­cal life.

Ki­wiSaver has been an un­mit­i­gated suc­cess. De­spite some wa­ter­ing down by the cur­rent Govern­ment, it re­mains the most suc­cess­ful ac­tion New Zealand has taken to im­prove our rate of sav­ing.

With over 2.6 mil­lion mem­bers, nearly 73 per cent of Ki­wis aged un­der 65 have a Ki­wiSaver ac­count. Ki­wiSaver in­vest­ments to­tal over $28 mil­lion. But something is go­ing wrong. More and more work­ing Ki­wis are tak­ing ‘‘hol­i­days’’ from mak­ing con­tri­bu­tions to Ki­wiSaver.

The num­ber of peo­ple tak­ing a con­tri­bu­tion holiday has in­creased by 14 per cent. That is a big jump, but in an en­vi­ron­ment when house­hold debt is at record lev­els and wages for most peo­ple are stag­nant, it shouldn’t be a sur­prise.

Hav­ing a job, work­ing hard and sav­ing should give us all con­fi­dence that we will be able to build a bet­ter fu­ture for our­selves and our fam­i­lies. But for too many of us work is not even pay­ing the bills.

A few weeks ago I at­tended the Manawatu Home Bud­get­ing Ser­vice AGM.

I asked if they were see­ing any changes in the types of peo­ple ac­cess­ing their ser­vice. The an­swer was yes – work­ing peo­ple make up a greater pro­por­tion of the peo­ple they see. It’s a sim­i­lar story at the Sal­va­tion Army who in­creas­ingly sup­port work­ing peo­ple with food from their food­bank and sup­port to find hous­ing.

The gap be­tween what peo­ple earn and what things cost has grown to in­suf­fer­able pro­por­tions.

Over the past few months, Palmer­ston North house prices have be­gun to rocket up­wards and even rents are ris­ing beyond in­comes. The num­ber of peo­ple on the wait­ing list for a state house in our city has quadru­pled in the past six months.

We can pre­tend that wages are ris­ing fast enough to cover costs. We can ig­nore the fact that mea­sures like the CPI leave out hous­ing costs. Or we can com­mit to a plan to lift wages, con­trol house prices and give peo­ple the chance to live well. The choice is in our hands.


For too many peo­ple, work­ing hard is not pay­ing the bills, com­pro­mis­ing Ki­wisaver con­tri­bu­tions.

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