By Charles Chauvel
Labour’s guiding principles on superannuation are fairness and sustainability. We believe that a cross-party agreement is crucial if we are to protect and preserve NZ Super for our children and keep it universally available.
For the good of all New Zealanders, John Key needs to move from his position of refusing to discuss this issue. We want all political parties to put politics aside and come together because we need a cross-party consensus Kiwis can rely on, and that delivers a fair result for everyone. We are open to considering good ideas from all parties that will contribute to the creation of a fair and sustainable scheme. We must also have transitional plans for those who can’t keep working and for those who have lower life expectancies.
We need to act now because there are real issues about affordability in the future. Treasury estimates the cost of NZ Super will double over the next 40 years as the baby boomers retire and our overall life expectancy increases. Add to that there are 5.6 people working today to pay taxes and support each superannuitant. In 40 years there will be just 2.4.
New Zealanders work hard and they expect the Government to do its bit. They expect the Government to deal with the tough issues. Labour proposes to preserve NZ Super by gradually lifting the age of eligibility to 67 over a 20-year timeframe, as recommended by the Retirement Commissioner. It is important to note that anyone currently receiving NZ Super or close to retirement will be unaffected and that changes would not start until 2020 and phase in over 12 years. We need to take steps now so people can plan for the change.
If we don’t tackle this tough issue now on our own terms, it will be forced on us later. This issue requires leadership and the courage to do the right thing. Labour has taken the lead. For all our sakes, the Government must join the discussion.
Charles Chauvel is Labour's Justice Spokesperson