National's Nicola Willis and Labour’s Barbara Edmonds have agreed to a cross-party accord on the future of retirement, with the pension age on the table.
The two women want to be finance minister after the election and both went head-to-head in Q+A's Finance Debate earlier this morning.
Moderator Jack Tame pressed the pair whether they would join a group that looks at the whole system, including superannuation, KiwiSaver and housing for older Kiwis.
Labour finance spokesperson Edmonds said yes straight away.
"Absolutely. I’d love to," she said. "There used to be a political accord in the early ’90s between the major parties in parliament. And I think that’s really key to get some certainty because this is long-term thinking."
Willis agreed, but with a condition.
"Yes, on one condition – that there is honesty from Labour about the fact that the current settings are not going to be sustainable for the next 30 years."
Edmonds accepted that the age of eligibility would be part of the talks but said it couldn’t be looked at on its own.
“It is a part of the retirement system. But you cannot have that in isolation,” she said.
“At the moment, the isolating part is that they want to raise super without consideration otherwise for the rest of it.”
Willis said the pair had made the same promise before.
“Barbara and I stood on a stage two years ago and agreed to the same thing. Within an hour, a press release had come out saying it wasn’t happening. So I hold my breath.”
Edmonds said “it was very different”, before confirming her support for “a political accord around the retirement system”.
'Ostriches with their heads in the sand'
Superannuation will cost more than $30 billion a year by 2030, according to economic forecasts, about $1000 a second. By that point, super and interest on government debt combined are forecast to take up 28% of total tax revenue.
National wants to lift the eligibility age gradually from a set date in the future and Willis said Labour’s position of preserving it over its next term was “not fiscally credible”.
“The population is ageing, and there are going to be fewer taxpayers for every retiree. We can afford superannuation right now, but in the future, the settings are going to have to change,” she said.
“They continue to be ostriches with their heads in the sand, pretending that nothing will ever have to change.”
Edmonds pointed to Labour’s role in setting up KiwiSaver and the Cullen Fund. She said National’s suspension of contributions to the NZ Super Fund in 2009 had cost billions.
“Superannuation is only unaffordable if we can’t make New Zealanders want to stay here and to contribute to the other side, which is the revenue," she said.
'Very big conversation to have'
At a Labour campaign announcement later on Sunday, Edmonds told media that what she had agreed to was an accord on the whole system, not just superannuation.
“It’s not just super, it’s KiwiSaver, it’s housing, it’s healthcare. We need to look at the full retirement system as a whole,” she said.
“This constant picking apart of just superannuation and the age of eligibility is not a sound conversation to have because it also ignores the fact that we’re going to need more revenue anyway.”
Reporters asked whether Labour and National could take a joint position on retirement to the 2029 election. Edmonds said that would depend “on where the parties in Parliament get”.
“This is a very big conversation to have with some very long-term decisions,” she said.
“I am absolutely open to having it with the parliamentary parties, but it has to be within the wider retirement system, not just picking apart super.”
For the full debate, watch the video above
Q+A with Jack Tame is made with the support of New Zealand On Air
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