Migrant pension changes delayed
Moves to make older migrants wait longer to qualify for New Zealand Superannuation are a step closer to becoming law.
But while MPs voted the New Zealand Superannuation and Retirement Income (Fair Residency) Amendment Bill through the committee stage of its passage through Parliament, they also agreed to delay the introduction by two years.
That followed concerns raised by Retirement Commissioner Jane Wrightson that older migrants would be given too little time to prepare for the changes. She had pushed for a delay of up to five years.
The bill, if it becomes law, will phase in the number of years a migrant has to be in New Zealand before qualifying for NZ Super from 10 to 20 years. Currently, NZ Super is paid to anyone aged 65 or older who has been ‘‘resident and present’’ in New Zealand for 10 years after the age of 20, and five years after the age of 50.
MPs from both Labour and National are backing the bill, which National’s Andrew Bayly, the MP in charge of the bill, said was significant. ‘‘Our good friends across the way in Labour agreed to support this bill.
‘‘It is one of the rare occurrences of collaboration across this House,’’ Bayly said.
NZ Super was a thorny issue that usually few politicians wanted to go near, Bayly said. In January, migrants and their New Zealand families protested to Parliament that the bill as it was drafted at the time would cause an overnight increase in the number of years a migrant would have to wait for NZ Super, from 10 to 20 years.
That meant a migrant aged 64 who had been in New Zealand for nine years would suddenly find themselves 11 years from qualifying for NZ Super.
Some dubbed the plan inhumane, arguing it should exclude people who had already moved to make New Zealand their home under the current 10-year rule.
A ‘‘legislative scrutiny briefing memorandum’’ from the Office of the Clerk of the House of Representatives in February warned there could be a ‘‘significant financial and wellbeing impact’’ on people just about to reach 65. Submissions made by migrant organisations on the bill, which had its origins in a bill presented by NZ First before it was swept from Parliament, also claimed it had racist undertones as it would disproportionately affect migrants from China and India.
Labour’s Priyanca Radhakrishnan, minister for diversity, inclusion and ethnic communities, had protested: ‘‘This bill will disproportionately affect some people and that is because immigrants from certain countries we have social security agreements with won’t actually be affected by this but immigrants from countries like China and India will.’’
Countries that have social security agreements with New Zealand include Britain and Australia. The provisions would also cover New Zealanders who spent long periods working overseas and returned to New Zealand later in their lives.
The protests from migrant groups resulted in MPs drafting a phased transition plan. This will mean that for every two complete years a person was born after July 1, 1955, they would need one additional year of residence, up to a maximum of 20 years. Anyone born on or after July 1975 would be subject to the full 20-year residence requirement. A provision was added so that refugees aged 55 and older are not caught by the planned changes. The change would result in a decrease in the total cost of NZ Super, with annual savings rising to more than $162 million in 20 years’ time.