KiwiSaver would become compulsory for every New Zealand worker from July 2028, if National is re-elected, under a major election proposal the party unveiled today.
National leader Christopher Luxon said the policy is about backing New Zealanders "to get ahead, build a bigger nest egg, and retire with greater financial security to give them a better quality of life and more choices in their retirement".
The policy package would carry a total fiscal impact of $361.6 million by 2030/31, funded from future Budget operating allowances.
Under the plan, contributions to KiwiSaver or an equivalent scheme would become compulsory for all workers from July 1, 2028, made at the prevailing default rate as part of an agreed glidepath lifting combined default contributions to 12% by 2032.
Self-employed workers would be required to contribute only the 4% employee-equivalent rather than the combined 8%, while those already in another employer-managed super scheme, and those on paid parental leave, would be exempt.
Individuals wanting to suspend contributions would have to meet the hardship test currently applied to early withdrawals.
Benedict Collins reports live as the PM and party faithful gather for the conference. (Source: Q and A)
"National will make KiwiSaver compulsory for all workers, set our kids up for a more secure future, support mums or dads on paid parental leave, and ensure older workers don’t lose out," Luxon said.
The party said it has shifted to a compulsory model after receiving feedback Kiwis were best served by guaranteeing everyone was more financially prepared for retirement, whether they work part-time, are self-employed, or "just need a nudge to save".
Luxon framed the change as a response to global uncertainty.
"Recent global volatility has underlined the need to strengthen our financial security.
"In a more uncertain world, New Zealand needs higher savings and greater financial resilience. Compulsory KiwiSaver will help deliver both.
"People will be able to suspend contributions only if they meet the existing hardship test currently used when people apply to make an early withdrawal from their KiwiSaver."
“Brighter days are ahead,” the party leader said. (Source: 1News)
The package also includes a $1500 "Baby Boost" payment for every child born in New Zealand, with automatic KiwiSaver enrolment at birth, from July 1, 2027.
"Parents will be able to contribute further if they wish but even if they can't, their kids will be well on their way to a bigger nest egg," Luxon said.
National said a $1500 investment at birth, growing at a long-run average return of about 7% a year, would be worth around $5000 by age 18, even with no further contributions.
From the same date, the Government would top up KiwiSaver for people on paid parental leave even if they are not contributing themselves, and extend compulsory employer contributions to workers aged over 65 - the latter directly implementing a recommendation from the Retirement Commissioner's 2024 review of KiwiSaver settings.
More to come
SHARE ME