The Financial Services Council (FSC) has welcomed the proposed KiwiSaver changes contained in the Taxation Bill introduced to Parliament this week.
The changes in the bill include opening KiwiSaver to people over 65 years old, establishing new employee contribution rates of 6% and 10%, and reducing the maximum contributions holiday that people can take from the scheme from five years to one year.
FSC chief executive officer Richard Klipin said the changes are “positive and if passed will significantly strengthen KiwiSaver and support its continued growth.”
“It is also heartening that the National Party has indicated that it will support the bill,” he said.
The proposed changes are supported by three major pieces of research that the FSC recently undertook, which looked at New Zealanders views on KiwiSaver. The first Growing the KiwiSaver Pie showed overwhelming public support for boosting the scheme and improving access to it. The second Great (unmet) Expectations found that older New Zealanders face a significant weekly income shortfall in retirement. The third Generation KiwiSaver found that under 35s will be reliant on KiwiSaver as their main source of retirement income.
“The consistent message across all three pieces of research though was clear public support for strengthening KiwiSaver and a call for government and industry to do more,” Klipin said. “As KiwiSaver enters its eleventh year and becomes an increasingly important part of all New Zealanders retirement planning it is essential that the scheme continues to evolve and improve. The changes in the bill do just that and are a positive step forward.”
Proposed legislation to give Kiwis over 65 access to KiwiSaver
Survey reveals decline in knowledge of KiwiSaver