National’s Super problem

May 25th, 2012 at 12:48 pm by David Farrar

My Herald column is on National’s Super problem:

One of the reasons National got re-elected is they were seen as more fiscally credible than the alternatives. As European governments crumble under the burden of excessive government spending, deficits and debt, voters at home place great stock on fiscal sanity.

However the stance on is the chink in National’s armour. Labour will try and use this issue to portray National as going for the easy spending targets but unwilling to target the largest item of spending.

Labour’s pledge to increase the age of entitlement from 65 to 67 is a tactical policy to try and position National as fiscally irresponsible, and National is locked into a five year old policy pledge that leaves it incapable of responding. …

The lesson for both the current Prime Minister, and any future Prime Ministers, is to never ever make any pledge beyond the next term of Parliament. Doing so is both short-sighted and anti-democratic. Elections should be about choices. Policies should change as circumstances change. Our three year electoral cycle allows policies to gain mandates in a fairly timely manner.

The Prime Minister’s pledge to never allow any changes to superannuation during his tenure will continue to grow as a problem for National. They are fortunate that at the last election the fiscal credibility of their opponents was weak, and a debate stumble by Phil Goff fatally crippled them. In 2014 David Shearer may have succeeded in portraying Labour as fiscally credible, and then the superannuation pledge could become a critical issue. It would be ironic is a pledge which helped National win the 2008 election became the reason they lost the 2014 election.

This is probably the last post for today as I’m in meetings the rest of the day. Enjoy the weekend!

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57 Responses to “National’s Super problem”

  1. Ryan Sproull (7,259 comments) says:

    Yes, John Key is bound by the promises he has ma—

    [to continue reading this comment, please pay $5+GST]

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  2. adze (2,129 comments) says:

    By the time I get to that age (in a little over 20 years) I’ll be lucky to get any government super…

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  3. Manolo (14,030 comments) says:

    Smile-and-wave appears incredibly stubborn and inflexible on this matter.

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  4. wf (464 comments) says:

    I don’t understand why he doesn’t change his mind. He’s allowed.

    Let’s hear him suggest 70.

    Ignore the squeals of promise-breaking and do it.

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  5. Alan Johnstone (1,087 comments) says:

    It’s an emperors new clothes issue. It can’t go on.

    I do have to query this though

    “Labour’s pledge to increase the age of entitlement from 65 to 67 is a tactical policy to try and position National as fiscally irresponsible”

    Can’t you admit the possibility that’s nothing to do with electoral calculations or National and is just a policy position that Labour think is in the long term interest of the country ?

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  6. Alan Johnstone (1,087 comments) says:

    “I don’t understand why he doesn’t change his mind. He’s allowed.”

    Because he’s went on record many times saying he would resign before doing it. He’s stupidly boxed himself into a corner here. Such bad politics is so unlike JK, I can’t help wonder if he was drunk when he first said it. I struggle for any other explanation.

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  7. rouppe (980 comments) says:

    To my mind it would be criminally irresponsible to start talking about raising the retirement age without talking about dismantling WFF and student loans.

    Both of these things are akin to leases on expensive toys. When Labour was in power and the world was bingeing on loans they had the cash-flow to pay for them. Never mind that they should have either reduced the tax take or held cash for times such as this – something any prudent housewife would do.

    When the crunch comes, the correct thing to do is begin trimming the expensive leases. In my house that would be Sky TV, the wheelie bin, and the newspaper sub. For a government, it most certainly should be WFF which was extended to galactic proportions as an election bribe.

    How many hundreds of millions a year would be saved if WFF cut off at $48,000 no matter how many kids you had? Then you would be able to legitimately have a conversation about retirement age.

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  8. Pete George (23,680 comments) says:

    He’s not quite locked into a corner, although I suggested recently:

    Key seems to be still locked into a painted corner swept under a rug in a hole dug while kicking the can down the road ignoring the Super elephant in the room.

    But I also said that Dunne has given Key a get out of Super free card.

    He should play this hand. He has already committed to a discussion paper on Flexi-Super with United Future. He could extend this to be a cross party discussion as an act of good faith, with a view to future whole of Super discussions.

    For this to work Shearer will need to quit the political pointscoring too. The long term future of Super is far to important to remain dragged down by that.

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  9. Manolo (14,030 comments) says:

    To my mind it would be criminally irresponsible to start talking about raising the retirement age without talking about dismantling WFF and student loans.

    Perfectly well said.

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  10. Chuck Bird (4,923 comments) says:

    In the 60′s and early 70′s before Muldoon’s bribe people could get the general pension at 65 with no means test. However, if they said they were too old to work as their body was worn out they could get the same pension at 60 but it was means tested. As I recall the means test was on both income and and asset’s in addition to the family home.

    This type of means tested pension should be considered by Key in the future for those between 60 and 65. I am sure Key could get his spin doctors to claim he has not broken his promise.

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  11. Alan Johnstone (1,087 comments) says:

    “When the crunch comes, the correct thing to do is begin trimming the expensive leases. In my house that would be Sky TV, the wheelie bin, and the newspaper sub. For a government, it most certainly should be WFF which was extended to galactic proportions as an election bribe.

    How many hundreds of millions a year would be saved if WFF cut off at $48,000 no matter how many kids you had? Then you would be able to legitimately have a conversation about retirement age.”

    The pension bill today, is currently 5 times higher than is what’s spend on WFF. The WFF cost isn’t tracking upwards, the pensions on is going to skyrocket as people age and live longer.

    See below for the numbers. Pensions are the elephant in the room.

    http://www.treasury.govt.nz/budget/2011/execsumm/11.htm
    http://wheresmytaxes.co.nz/

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  12. Portia (175 comments) says:

    It’s not just Key’s stupid resignation promise, it’s the fact that he is so sensitive about the issue he can’t stand even a general discussion about it. So, when the Retirement Commissioner or Treasury start mentioning the issue that must not be named, JK immediately comes out and repeats his “over my dead body” vow; thereby shutting down any meaningful debate.

    Me, I’d start raising the age by one month every quarter from now until the desired age is reached (which given longevity rates should be closer to 70). Labour’s piss-weak solution would have succeeded only in bolting the stable once the last baby boomer had galloped out.

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  13. mikenmild (11,662 comments) says:

    It’s pretty clear that a discussion on superannuation is a bit ambitious for Messrs Key and English. Similarly, they have locked in WFF and interest-free student loans as things they don’t like but are too timid to change. I think they are happy at being a truly conservative government, in the sense that they really, really don’t want to make any changes that could possibly scare people. Well, some people. They’re fine with a little tinkering and bullying here and there, but overall we are left with aspiratonal talk rather than reforming deeds.
    It’s hard to avoid the conclusion that they are sleepwalking their way to their knighthoods and pensions.

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  14. expat (4,050 comments) says:

    The old “meetings for the rest of the (fri)day”…aha.

    Down the viaduct?

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  15. tom hunter (5,078 comments) says:

    By the time I get to that age (in a little over 20 years) I’ll be lucky to get any government super…

    Funny you should say that as I was just thinking back to conversations I’d have with various friends and associates in the late 1980’s as the whole Rogernomics deal began to tear down the cozy society our parents and grandparents had built.

    We all looked at what that revolution meant for other commitments that governments of the past had made and other institutions that had been built – and almost all of us (even the lefties I knew) concluded that we would probably never see much of anything by the time we hit 65, and that we would almost certainly be working until we were 70 anyway, since “retirement” just does not mean what it used to.

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  16. orewa1 (410 comments) says:

    Steven Joyce this morning has dismissed the superannuation issue as a “distraction.” How much further out of touch can these guys get? DPF is right.

    But then, a Budget that reduces the number of teachers while increasing the number of tax inspectors is hard to relate to the promise of a “brighter future?”

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  17. Mark (496 comments) says:

    Labour isnt credible about NZ Super either, their policy at the last election was to make changes in the year 2020 and if you could prove you couldnt work past 65 then you get NZ Super but they would call it something else.

    To be credible on the issue you need to go to the electorate and say if you vote for us we will raise the age of super during the term of the office.

    By saying you wont do it until 2020 there is no guarantee you will be in office and that some other government over turns the law. Any promise on out years of spending arent worth the paper they are written on.

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  18. Chuck Bird (4,923 comments) says:

    I heard someone on talkback a few weeks ago say they heard Key interviewed overseas. When he was asked about super he said if he was forced to choose he prefer means test everyone rather than raise the age. The caller may have been quite wrong but I wonder if anyone has heard something similar

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  19. s.russell (1,646 comments) says:

    Super inflexilility may be a liability now, but I am not sure that it will remain one. In two years time when the books are close to balancing and Budgets are projecting growing surpluses, public appetite for austerity is likely to fade too. And it may then be Labour that has boxed itself into a corner.

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  20. tom hunter (5,078 comments) says:

    Of course politicians can have courage in dealing with government funded pension schemes – after they’ve left office of course.

    So in the USA, where they face the same problem, we have a hilariously blunt letter from former GOP senator, Alan Simpson (of Simpson-Bowles commission fame):

    To Whom It May Concern:

    Erskine Bowles and I thoroughly enjoyed our time on the West Coast and received an excellent reception from folks — at least those who are using their heads and have given up using emotion, fear, guilt or racism to juice up their troops. Your little flyer entitled “Bowles! Simpson! Stop using the deficit as a phony excuse to gut our Social Security!” is one of the phoniest excuses for a “flyer” I have ever seen.

    You use the faces of young people, who are the ones who are going to get gutted while you continue to push out your blather and drivel. My suggestion to you — an honest one — read the damn report. The Moment of Truth — 67 pages, and then tell me if we’re not doing the right thing with Social Security. What a wretched group of seniors you must be to use the faces of the very people that we are trying to save, while the “greedy geezers” like you use them as a tool and a front for your nefarious bunch of crap. You must feel some sense of shame for shoveling out this bullshit. Read the latest news from the Social Security Trustees. The Social Security System will now “hit the skids” in 2033 instead of 2036. If you can’t understand all of this you need a pane of glass in your naval so you can see out during the day! Read the report. Get back to me. My address is below.

    If you don’t read the report, — as Ebenezer Scrooge said in the Christmas Carol, “Haunt me no longer!”

    Best regards,

    Alan Simpson

    Woah! If you can’t understand all of this you need a pane of glass in your naval so you can see out during the day!

    That’s one to treasure!

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  21. mikenmild (11,662 comments) says:

    That’s fine Mark – if you don’t think making gradual changes between 2020 and 2033 is very credible, then how credible is a government claiming that no changes at all are necessary?

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  22. peterwn (3,298 comments) says:

    The best thing would be for John to swallow the rat on this one. Let National’s caucus discuss it while he is out of the room and allow National MP’s a conscience vote on the third reading thus allowing John to ‘cross the floor’ on this one. This would allow National to veto any amendment at second reading stage leaving Parliament with a ‘take it or leave it’ package. Set up the PR so the opposition looks ‘irresponsible’ if the measure fails. This will have the opposition completely flawed.

    It should ‘cut in’ faster than Labour’s 2011 proposal. Labour also indicate that those in ‘manual’ jobs could continue to retire at 65 and collect super but did not really try and define the boundaries. Perhaps Labour would have in practice allowed all those who had an income below a certain amount in the year preceeding a super application to collect super from 65. Some ‘transitional’ measure for those between 65 and the ‘new’ age limit would help take the sting out of it. Perhaps those with total income over (say) $50k get no transitional super while those below that level get transitional super on a sliding scale up to 90% of normal super.

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  23. Harriet (5,118 comments) says:

    In OZ, Labor under Rudd talked endlessly about ‘the rising cost of the babyboomers’.Most young people who thought that baby boomers were rich, then agreed wholeheartedly with Rudd when he said he would raise the retirement age to [I think]67.

    The only problem is, that it is going to be introduced in 2028 – well past the retirement age of nearly all those who are classified as ‘babyboomers’.And the best bit was, that at that point in time[about 2009] the ‘babyboomers’ then had no reason not to vote for Labor.

    The ‘young & dumb’ ended up voting in virtually ‘their own retirement age’ and for no reason at all, as the problem of the babyboomers will have long been buried by then.

    That is the problem of having ‘Messiahs’ voted in as leaders; People stop thinking, especially young people.

    So when exactly is NZ Labour’s proposed retirement age going to be introduced ? Yeah, I thought so…….

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  24. rouppe (980 comments) says:

    The pension bill today, is currently 5 times higher than is what’s spend on WFF. The WFF cost isn’t tracking upwards, the pensions on is going to skyrocket as people age and live longer.

    I must confess to some surprise at the super number. However a 2.1 billion on WFF (which I assume “Family Tax Credit” is) combined with 565 million for in-work tax credit (which had to be brought in since WFF made childless families comparitively worse off) makes for a lot of capacity for future superannuation.

    Lets also not forget, that super bill is going to fall away just as fast as it is increasing as superannuitants die. There’s lots of talk of people living longer. We will die…

    My main gripe with government – both central and local – is the propensity to focus on “more”. There’s never a “stop”.

    And Harriet is right. Even if Labour’s retirement changes were made, it would miss about 75% of baby boomers, who are starting to retire right now.

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  25. Pete George (23,680 comments) says:

    peterwn – good ideas. I’m sure there’s a way around this, if enough others in National have the will to address it, and if Labour and all the other parties are prepared to genuinely put politics aside on this.

    It’s difficult to kow what the best solution is.

    It’s a no-brainer that it should be discussed and addressed – cross-party.

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  26. Chuck Bird (4,923 comments) says:

    peterwn, as I mentioned there use to be a transitional super prior to Muldoon’s bribe. It was heavily means tested. It could work for those aged 65 to 67. Key should look at this option.

    Something else that is going to have to be looked at in the future is rest home care.

    It is outrageous that someone who has earned a modest income all there life can have all their assets striped for rest home care so their children and grandchildren are left little but people worth several million but hidden in family trusts pay nothing for their rest home care.

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  27. Adolf Fiinkensein (2,914 comments) says:

    By coincidence I posted on this very issue this morning, before I read your piece.

    I suspect the PM is not as daft as you make him out to be and if people thought carefully, they might see that raising the age of eligibility may not in fact be as critical as some would have them believe. There are other ways to skin the cat.

    http://nominister.blogspot.com.au/2012/05/super-annuation.html

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  28. mikenmild (11,662 comments) says:

    Logically, no government is likely to address the superannuation issue until it becomes much more pressing. That is likely to see a much shorter timeframe for introducing the changes that will become inevitable. The only thing that might change the situation would be the election of a government unafraid of major reforms. I’d venture to suggest that would rule out any government led by the National Party.

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  29. tvb (4,494 comments) says:

    John key can play this out until people are begging him to do it. No one is suggesting it be done anytime soon. So let the chorus continue.

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  30. Pete George (23,680 comments) says:

    No one is suggesting it be done anytime soon.

    Something has been suggested – National have committed to it, and Key is comfortable with looking at it:

    The government notes that United Future has been committed to its “Flexi-Superannuation” proposal as a key part of its retirement policy and agrees that a government discussion document investigating this issue will be developed.

    http://www.unitedfuture.org.nz/confidence-and-supply-agreement/

    I think that’s schedule for next year. It doesn’t cover everything but it’s a start and it must contain some consideration of costs.

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  31. martybc (5 comments) says:

    If it is an economic certainty that the age of national super has to rise around 2020, then this government doesn’t have to do anything. Assuming that this government does well and wins another election before losing to a Jacinda Ardern led Labour party in 2017 – it will be that government that has to deliver the super shock (by super I mean superannuation).

    And then the Opposition (which is the government who avoiding doing what had to be done) will chip away about how it had to be raised in 2020 because the current government was rubbish a economic management, and loads of people will believe them and … oh, its so depressing.

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  32. Chuck Bird (4,923 comments) says:

    The problem with that is Pete that who is unable to work past 60 for whatever reason would get a lot less to the rest of their lives.

    I gross just under 20k on single super. I have have a freehold home and a number of investments. I live reasonable well. however a single person on a reduced super with no extra income living in a rented accommodation would live a pretty spartan existence for the rest of their lives with medical expenses going up.

    As things are people on super without extra income are just getting by.

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  33. Pete George (23,680 comments) says:

    Chuck – every way you look at it there are potential anomalies, it’s a very complex issue. One major one is that many of the people who have contributed the most towards it (in tax) need it the least.

    Flexi-Super at least gives people options and choices. There should be nothing to stop someone accepting a lower rate of Super starting at 60 but reduce hours to work part time for a few years (as long as that work is available).

    And many people have life expectancies of around 65 (eg male Maori diabetic) so with no choice they may end up getting no Super.

    Those are the sorts of things up for discussion.

    Regardless, I see the Flexi-Super discussion as a toe in the Super door. That’s better than any else at the moment – even if it finds that we can comfortably kick the can down the road for a few more years.

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  34. peterwn (3,298 comments) says:

    Chuck Bird – ” It is outrageous that someone who has earned a modest income all there life can have all their assets striped for rest home care so their children and grandchildren are left little …”

    Why is it ‘outrageous’. If anything it should be up to children to support their parents in old age as in the bad old days. Saying that children are ‘entitled’ to an inheritance is just another manifestation of the ‘entitlement philosophy’ that pervades modern politics. If the person has assets, then why should the long suffering taxpayer be expected to meet any extra cost of care beyond superannuation payments.

    ‘….but people worth several million but hidden in family trusts pay nothing for their rest home care “. WINZ makes it difficult to do this, even with the abolition of gift duty. I am not sure of the ‘leakage’ with this, but it may not be too great. WINZ could turn the screws harder on this. A change to trust law such that beneficiaries must be made aware that they are beneficiaries, and making beneficiaries entitled to get copies of trust accounts could help. WINZ could then demand to see trust accounts and could deny a supplement on the basis that the trust can afford to make a distribution to the beneficiary to help with old age care. A rest home supplement could be subject to the person (and/or rellies and professional advisers) being required to swear before a JP that they as far as is known are not beneficiaries of any trust or have assets anywhere on Earth. If any doubt no supplement – or alt least they can share a 6 bed dorm. Perhaps Bill might like to consider this for the 2013 budget.

    See:
    http://www.workandincome.govt.nz/individuals/forms-and-brochures/abolishing-gift-duty-and-the-effect-on-benefits-factsheet.html

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  35. Chuck Bird (4,923 comments) says:

    Pete – I agree there should be a discussion. I can understand you believe Flexi-Super is the best as your party promotes it. What is wrong with my suggestion that is similar to what we had in the late 60’s? Transitional means tested super from 65 to 67 and regular super after 67. The cost of the transitional super should not be that great. I would think most people would choose to work till 67 if they could. Those who could not would have been getting and unemployment benefit so the transitional super would just cost the difference.

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  36. Chuck Bird (4,923 comments) says:

    Peter – sorry if I did not explain myself better. If measures are put in place such as you suggest to stop wealthy people using in trusts to avoid paying their share nothing is outrageous. I remember the case of Bulger ‘s Mother that the media highlighted.

    I admit I have a thing about trusts. I have a court case coming up where a former lawyer is trying to avoid paying me a legitimate debt using trusts.

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  37. Pete George (23,680 comments) says:

    I can understand you believe Flexi-Super is the best

    I don’t believe it’s best, I think it’s an idea that’s worth considering.

    It would be worth looking at variations on your proposal. What about means tested from earlier, 60, or 62? That’s something like what I think Labour suggested after their straight raise to 67 went down like a detached clanger.

    Costs would need to be looked at, but there could be quite a few low income people from 60 on sickness or unemployment so it might be little more than a switch of benefit name.

    I don’t like the misuse of trusts either to get beneits that richer people don’t need. It happens with retired people, it happens with student allowances, it’s used for tax avoidance – but the Government keeps working towards tightening up on that.

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  38. Pete George (23,680 comments) says:

    And what’s the problem with someone at 60 choosing to retire and take up Super (if income/asset tested) and leaving an opening for someone to take the job and go off unemployment?

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  39. Monique Watson (1,062 comments) says:

    My housewife’s logic suggests to me that the butt fucking of the country’s coffers began back in 1975 with the introduction of the first of three big election bribes: Non means-tested Super by Muldoon who couldn’t foresee that the generation that supported his would eventually expect to pull Super under the same conditions. The cry of – “it’s not fair to means test Super as it’s a double tax”, became intrenched and now no government can touch it. With the next two election bribes, interest-free student loans and WFF our position as an economic minnow has become entrenched.
    Approx 60% of the population enjoy some kind of welfare largesse.

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  40. maxwell (56 comments) says:

    An article in The Listener last year said that someone born today could expect to live until they were 100 and that the life expectancy of women had risen by 6 years in the last 20 to around 82. That’s 17 years, on average, requiring super and increased medical costs.

    While Labour deserves credit for at least opening the door to let us see the elephant in the room, their election “promise” to increase the age of entitlement by two years to 67 by 2030 is beyond cynical, as it is more than likely to be well outstripped by an increase in life expectancy.

    IIRC we put the age out from 60 to 65 AND reduced the amount from 80% of the average wage to 65 over a decade,
    circa 91 to 2001. This is the sort of time frame we need to be looking at.

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  41. Chuck Bird (4,923 comments) says:

    Monique, as I recall super at 65 was not means tested before Muldoon. Most people who got it at 65 retired then. Many were forced to. Muldoon dropped the age to 60 and made that not subject to means testing either. That was fantastic for those near 60 who were planning on working to 65 in any case. They carried on working will collecting super for 5 years and had a very comfortable retirement.

    Your logic is good but you are much younger than me. I think the problems started with Kirk in 1972 when Labour brought in ACC.

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  42. kowtow (8,733 comments) says:

    It’s not superannuation it’s a state old age pension.

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  43. Alan Johnstone (1,087 comments) says:

    “Lets also not forget, that super bill is going to fall away just as fast as it is increasing as superannuitants die. There’s lots of talk of people living longer. We will die…”

    Sadly No, it will not. This is due to increased life expediency rates, our birth rate simply doesn’t have the number to support it. It’s estimated that 44% of kids born this year will reach 100 years old.

    Also, the health spending bill will track up exponentially alongside super, old people get sick, they cost a fortune to look after. The health bill will increase by 10% for every 3% of the population that is over 70 (fasted growing group). Universal non means tested public health (with access to world class drugs) is as about as sustainable as the pensions, i.e. not at all.

    When I was in my 20s, I thought policy was vital, as I got older and into my 30s i concluded it was all about macro economics, only now i’m in my early 40s do I realise that demographics are the single most important factor in a countries success or failure. Nothing else matters even nearly as much.

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  44. peterwn (3,298 comments) says:

    The problem with Muldoon’s super scheme was that it effectively allowed those on (or who could join) ‘defined benefit’ superannuation schemes to ‘double dip’. People on these schemes worked for the public sector (including local bodies), banks or insurance companies. AFAIK it was just not available for anyone else. The majority would have been public sector employees so the tax and rate payer effectively pays twice for their superannuation – via the ‘defined benefit’ and via National Super.

    The only other ‘superannuation’ schemes at the time were sticking the money in the Post Office or Savings Bank at 4.5% interest, or purchasing endowment insurance policies. These savings got almost completely trashed because of the rampant inflation in the early 1970’s which was one of main reasons behind Muldoon’s scheme.

    Chuck Bird – Ask the person you are claiming money off how much he paid into the trust or ‘gifted’ in the last two years. You should be able to ‘claw back’ what is owed to you from the trustees up to that sum of money.

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  45. orewa1 (410 comments) says:

    Sitting behind the superannuation debate is a big connundrum that we dont talk about, relative to the aging population. (That includes me – I am in my 60s.)

    The more we spend on the health of oldies like me, the longer they live. And the longer they draw on national super, health services, et al. That deprives our grandbrats of health services.

    In a purely economic sense, it would be sensible for the government to remove superannuation so we freeze in the winter, give us free cigarettes, and subsidise the booze that we use to make our later years more palatable.

    But in an economic sense, the issue is whether responsibility for the well being of the oldies lies with themselves (ourselves), whanau, or government.

    Its a social and economic debate which doesn’t happen in this country.

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  46. Johnboy (16,994 comments) says:

    It’s all right for you young whipper-snappers to talk about cutting off my bloody super but just you remember that my ancestors fought in the war to preserve my superannuation entitlement and all my life I have worked towards collecting it despite the politicians pronouncements on it and God help any politician that suggests reducing it so there!!! :) :)

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  47. Johnboy (16,994 comments) says:

    They should really give us more orewa1 so we can buy quality piss to while our last years away on instead of Tui or cheap sherry eh? :)

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  48. Luc Hansen (4,573 comments) says:

    I agree with Joyce – it’s a distraction. And English has said it remains a long term problem, 15-20 years into the future. A lot happens in 20 years.

    In the meantime, National would be quite happy if the country does their job for them and convinces itself that shifting the age would be some kind of magic potion.

    It won’t be. It’s just more fiddling.

    We need to grow the economy and rebuild the Cullen fund, then, and only then. look at the age thing if we need to. It’s important to remember that retiring the oldies opens up oppotunities for the younger generation.

    Let’s concentrate on the utter gloom of English’s budget, especially a fixation on attaining a surplus, even in a hostile economic environment, that no respectable commentators, including the ratings agencies, say is especially needed or even desirable at this time.

    The whole debate is just acting as a decoy runner while the meanest minds scheme how to transfer yet more dosh to the most well off, bugger the future generations.

    At a quick guess, probably wildly underestimating, the extra 30 billion in additional borrowings projected over the next four years incorporates about 6-8 billion in tax cuts for those who don’t actually need it, and who won’t spend the bulk of it on consumer items.

    And who prefer us to focus on the reproductive systems of women beneficiaries.

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  49. Johnboy (16,994 comments) says:

    Perhaps we should declare war on Israel Luc.

    Once we are occupied and radical anti Semites are liquidated we could look forward to a bright new future such as Germany after the Marshall plan? :)

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  50. Luc Hansen (4,573 comments) says:

    Feel free to do that, JB, but you would need to prepare to have your ass kicked by all those US weapons. I’ll duck.

    The anti-Semite thing is all getting a bit tiresome, JB, you poor sod.

    Just point out one thing I’ve said that denigrates Jews as a people. And how my support for the official US position on settlement of the conflict can be branded anti-Semite.

    Start looking. I’ll check back later.

    But you better reply on GD.

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  51. Johnboy (16,994 comments) says:

    Nerve touched again! :)

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  52. heathcote (104 comments) says:

    DPF is wrong when he says the baby boomers will be with us in 10-15 years time (see Herald article). They are with us now! Children born from 1946 on are now starting to pick up super, no wonder the cost is to rise $700m more next year.

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  53. freedom101 (509 comments) says:

    I don’t think Key has factored in the demoralising effect that his super promise has on thinking NZers. The message he gives is that he won’t lead on this important issue.

    Therefore, the subliminal message is that the country’s going no where under him. If he won’t lead on this, what else is he not doing that he knows he should do? It’s pathetic.

    People leave for Australia for lots of reasons, but a lack of hope and confidence in the future would be an important one. When you lack leadership, this has a direct flow on effect in terms of confidence, direction and hope.

    WFF and student loans are two more areas of rampant socialism which cannot be justified under any rational analysis. Again, too hard.

    These problems are so large in their impact on the future of the country that no wonder many are drawing the conclusion that NZ has reached a tipping point where the counttry’s future is essentially a land of beneficiairies, funded by foreign capital. When the foreigners stop lending it will all implode.

    In my opinion, that’s why so many are leaving.

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  54. krazykiwi (9,186 comments) says:

    is to never ever make any pledge beyond the next term of Parliament.

    Other than the recurring, implicit pledge… that of endless, profligate handouts designed to buy voter loyalty

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  55. Paulus (2,658 comments) says:

    I expect that Tax changes will take place to increase incomes in return for cancelling the WFF.
    I expect that interest will be payable initially at at very modest rate, increasing over a number of years to a realistic level.
    Then Superannuation can be amended to 67 – but only once the above anomalies have ben addressed.

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  56. edd (157 comments) says:

    Great strategy Bill English. I must take my hat off to you; if I remember..

    Hiding the nasties from the public and then rushing them through parliament under urgency, with out any chance for democracy, was brilliant once again….

    Dictatorship by stealth… Very modern.

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  57. rouppe (980 comments) says:

    @Alan you miss my point.

    Regarding that estimate of someone born today living to 100, I remember in the 70’s a report that a single hens egg would cost $20 by now. That hasn’t happened. Similarly even if that person does live to be 100, there won’t be as many of them. Why?

    The current fiscal pressure is because of the baby boomer bulge. Those in that bulge will die. Once that happens the demographic curve will be much flatter.

    That person born today, who lives to 100, won’t be in the same bulge. They will have similar numbers of people in all the demographic groups both younger and older than them. What I’m getting at is that this is a temporary problem. Much like Christchurch is a temporary (but still expensive) problem.

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