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How do we deal with New Zealand Superannuation? - TOP

NZ Super is a touchy subject for many, especially around election time.  As we have seen on many of our Facebook threads, there is also a wealth of opinion on how it should be managed. Like everyone else, TOP has an opinion too, and it happens to be one of our main policies. Unfortunately, there seems to be a large amount of confusion on how this policy will actually affect people, so we want to make sure we are clear on what we are trying to achieve. 

Firstly it is important to point out that with all our policy we make sure we have a way to pay for it. We always try to show the cost and benefit, as after all almost everything has a trade-off. Political promises without the source of funding are common but disingenious, even deceitful. In this case our proposition is to cut NZ Super in half and then means test any top up required. For people who need all of their NZ Super there will be no change. With the proceeds we intend to provide a UBI (Unconditional Basic Income) to all parents with young children, and spend the rest lifting kids out of poverty.

Means testing NZ Super will ensure all elders still get the income they need. For people over 65 earning other forms of income (as defined by our tax policy) the amount of “top up” they’re entitled to will abate from $10k (if they earn nothing) to zero by the time they’re earning $50,000 pa. To reiterate, those people that earn over $50k will still be guaranteed $10k a year from our “Elders UBI (Unconditional Basic Income)”.

Our rationalisation of NZ Superannuation – long overdue and avoided by the Establishment parties who simply will not deal with this issue, affects only those who do not require such significant taxpayer assistance.

The rationale

The total cost of NZ super is around $12 billion pa, and that amount is increasing each and every year. The Establishment parties are ducking and diving around raising the age to make it affordable, something that will make every retiree worse off. Why should we continue to give this generous benefit to wealthy people like Gareth, when we could direct money to people who actually need it, like young families?

Where is the money going?

Half of all families with new-born children will experience at least a year of poverty, and for 1 in 4 that poverty will last for 4 or more years. Every cent raised from this means testing will be redirected toward our “Thriving families” policy, giving all families with children under three $10,000 per year as a “Young Familes” UBI. It will also fund further support for poor families, and free, full time, high-quality early childhood education.

The evidence is clear that the return on investment for society is much higher when investing in children early, so by doing this we can help nurture the most vulnerable sector of our society, all at the expense of a few less overseas holidays for our wealthy retirees.


Showing 5 reactions

  • Steve Cox
    followed this page 2017-05-12 19:59:25 +1200
  • David Jones
    commented 2017-05-12 19:56:03 +1200
    1. Changes to National Super must be subject to a minimum of 40 years notice – 40 years is what it takes the individual to create adequate retirement savings as is recognised by superannuation funds providers. Changes under 40 years notice is a break in the social contract.
    2. Raising the age of entitlement is not an option for ordinary working people – it is only advocated by people in soft jobs who spend their lives in front of a laptops swilling lattes and attending “meetings”.
    3. We cannot afford National Super is a deliberate and mischievous lie – cynically aimed at the student loan generation to create divisive resentment against their elders.
    4. National Super IS sustainable but there may be better ways to achieve the same effect – in the 1950s there were more dependents to breadwinners than ever there will be at the peak of the baby boom.
    5. Compulsory superannuation savings is the ONLY acceptable replacement for National Super – individuals do not recognise the need to save for the future until it is too late. Most first world countries recognise this and have already implemented such measures.
  • Kem Johnson
    commented 2017-05-12 19:31:10 +1200
    This is a very good idea, even though it may cost me a few extra dollars. Thanks for sticking your collective necks out.
  • Oliver Krollmann
    followed this page 2017-05-12 16:17:36 +1200
  • Doug Mercer
    commented 2017-05-12 12:57:54 +1200
    This is a poor way to introduce a policy affecting superannuation. You did something similar when your Tax Policy came out. Superannuitants worry about their financial future, more so than any other sector because it affects every purchase decision they make. They rightly become fearful when politicians start talking about changing things and radical change scares them even more. You should have provided more detail on how the proposed means testing would work so that people like me could assess the impact on their lives. I had already decided to continue to vote TOP even though the tax policy will affect me badly (valuable house, poor savings) but it was a tough decision to make – altruism has its limits. Now you are telling me that I can no longer rely on receiving the $15,000 a year from the government which I depend on to continue living in my current 2 bedroom house because I might be means tested but you haven’t said how the means testing will work. You imply it will be based on income which in my case will only be a little interest on savings but if it includes assets then I face the prospect of having to sell my home to survive much earlier than my wife and I would like which would be gut-wrenching for both of us. It may be that I’m worrying about nothing but my point is you may be needlessly scaring the horses by releasing this policy without sufficient detail to allow people like myself to allay their concerns. It also makes it a lot easier for your political opponents to dismiss your policy with fear-mongering one-liners.