Abolish all default kiwi saver providers and replace with a fee free (or very low fee) government scheme that invests in low cost index funds only.
The government scheme would provide a variety of funds based on risk.
People automatically enrolled would be matched to up to the appropriate fund based on age i.e. a 25 year old would be invested in a high risk (90-100% equity fund).
When an auto enrolled person gets close to retirement age they are transferred to a more conservative fund.
The future value this would generate for New Zealanders in aggregate would be staggering for relatively little cost to implement.
Other things to consider/comments:
Any account that has been automatically enrolled into a default provider would be transferred to the new government scheme.
Only losers from this plan is the financial services industry. Extremely easy to show that in aggregate they are a liability plus people still have the right to invest with them.
Make Kiwisaver compulsory and replace the 1st home buyer withdrawal with another form of government support.
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