Major KiwiSaver providers say about half their members so far have not contributed enough to get the full government tax credit this year - a statistic that is raising concern among some parts of the sector.
By Susan Edmunds of RNZ
The government will pay about $260 into the accounts of people who have contributed $1042 into KiwiSaver by the end of June.
Anyone who is working full-time and earning the minimum wage should get to this level of contribution if they are saving at the default rate.
But Westpac said 53% of its eligible members had not yet contributed enough to qualify.
That is up from 49% who missed out last year, and 48% in 2024.
This is the first year that 16- and 17-year-olds qualify for the government contribution and Westpac said 96% were on track to miss out.
Andrew Twidle, chief executive of BTNZ, which provides the Westpac KiwiSaver scheme, said people could still make a voluntary payment by the end of the month to receive the bonus.
He said women were less likely to have contribute enough in many age groups, particularly in the 18- to 24-year-old cohort.
"If we look at just those members in employment, the gender gap becomes more prominent, with women accounting for about 60% of all working KiwiSaver members who are currently on track to miss out on the government contribution," he said.
ANZ, the country's largest provider, said it was sitting at roughly the same level.
At the end of May, more than 53% of eligible ANZ Investments' KiwiSaver members had contributed enough to receive the full government contribution, with around 17% more on track to receive at least a partial government contribution.
Alarm over overall figure
Retirement Commissioner David Boyle said it was not surprising that a large proportion of 16 and 17-year-olds had not contributed enough.
"We're talking predominantly students, right? They'll be in their last years of high school. I can imagine they would be thinking of far better things than getting their government contribution."
But he said the overall figure was alarming.
"There's just a lot of people not contributing enough ... more New Zealanders perhaps not working or who have been made redundant, self-employed contractors.
"It does highlight the challenges environmentally but also New Zealanders are missing out on money that could be used and should be used for helping them to be in a better place in retirement."
Last year's KiwiSaver report from the Financial Markets Authority showed that there were 1.265 million people who were members but not contributing, and not on a savings suspension.
Rupert Carlyon said the suggestion that 50% of members were not contributing at least $1042 in a year was "way too high". But he said he had spoken to self-employed people who had decided KiwiSaver was no longer worth it, given the cut in the government contribution rate from $521 to $260.
Dean Anderson, founder of Kernel, said 86%of members were actively contributing and 24% were not on track to get the full contribution. But he said that could be adjusted because this year people who were earning over $180,000 could no longer qualify.
At Generate, 61% of members had already contributed enough and another 18% were on track to do so.
At Pie Funds, chief executive Ana-Marie Lockyer said 60% of eligible members had already contributed enough to get the full contribution.
"A further 40% are currently short of the required contribution threshold, and around half of that group have not made any personal contributions at all during the year. This is significantly lower than last year, when more than 80% of eligible members received their full entitlement - that said we have a few weeks to go.
"It's too early to draw firm conclusions about the reasons for the decline, but it may reflect ongoing cost-of-living pressures, which are making it harder for some New Zealanders to prioritise saving. The reduced government contribution may also be a factor, with some members perceiving the incentive as less compelling than in previous years.
"Our message to members is simple: if you're eligible, it's worth checking your KiwiSaver contributions before the deadline. Even a relatively modest contribution can unlock a valuable government top-up and boost your long-term retirement savings. While immediate financial pressures are real for many households, taking advantage of available incentives remains one of the easiest ways to improve retirement outcomes over time."
Twidle said some people were not aware they could make voluntary contributions.
"Can we do better? Look, I always think we can do better. I think pretty much all providers do try and make their members aware through June and May. But I think we could absolutely try and engage throughout the year to encourage just those small contributions, which are easier to make in the moment than a larger contribution at this time of year.".
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