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Speaker 1: Ryan.

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Speaker 2: So we've heard from Nichola Willis in the pre budget

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Speaker 2: speech and she has hinted there's something that might be

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Speaker 2: coming to help with our Keiwi savers. The government will

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Speaker 2: also make its first ever withdrawal from the New Zealand

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Speaker 2: super Fun in twenty twenty eight. A couple of months ago,

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Speaker 2: I asked Nicola Willis about a potential boost because you

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Speaker 2: need to get our savings rates up. I think we're

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Speaker 2: at about one hundred or just over one hundred billion

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Speaker 2: dollars in Keywi saver assets at the moment, but you

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Speaker 2: look at Australia and it's something like forty trillion or

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Speaker 2: something massive. So anyway, I asked her about this a

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Speaker 2: couple of months ago.

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Speaker 3: There are a range of other ways in which we

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Speaker 3: could help ki savers improve their balances, including the rates

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Speaker 3: of contributions and other things. So we're working through that.

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Speaker 3: But I think it's really important that more Kiwi's have

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Speaker 3: more financial security in their retirement and I'm prepared to

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Speaker 3: make changes to deliver that.

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Speaker 2: Jonathan Erickson's a superannuation and super fun to expect with

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Speaker 2: me this morning. Jonathan, Good morning.

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Speaker 1: Good morning Ryan.

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Speaker 2: How do you think they might go about doing this.

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Speaker 1: Well, there's two are very easy or austral forward ways.

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Speaker 1: One is to cut the rate of interest on our

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Speaker 1: savings so you get texts on your retirement income while

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Speaker 1: it's rolling up. And if you reduce the rate like

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Speaker 1: they do in Australia to fifteen percent tax on the

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Speaker 1: investment income, whereas a lot of New Zealanders pay seventeen

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Speaker 1: and a half or twenty eight, well, that would make

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Speaker 1: a huge difference to the compounding interest effect of our

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Speaker 1: growing savings. The other one would be to remove the ASCT,

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Speaker 1: the withholding tax on the employer's contributions and put that

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Speaker 1: in tax free, which is something that the Labor government introduced.

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Speaker 1: When can we say that started that the National Party

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Speaker 1: took off when they were empower under bilinguish.

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Speaker 2: Now those are obviously not going to be cost neutral.

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Speaker 2: They're going to cost the government something. What about an

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Speaker 2: option that wouldn't cost them anything? I putting up the

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Speaker 2: employer contribution and doing it that way, Well, that.

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Speaker 1: Would cut the employers And whilst politicians don't know it,

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Speaker 1: I run a small business and I can assure you

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Speaker 1: that employers still have a vote.

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Speaker 2: Yeah, the good point, and they voted for this party,

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Speaker 2: didn't they? What about the super fund? You know, the

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Speaker 2: fact that we're going to start pulling out of the

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Speaker 2: super fund early? Is that a worry or should we

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Speaker 2: reach out about this?

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Speaker 1: We should be thrilled. This is what the super fund

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Speaker 1: is for. It's up to eighty billion, which is just

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Speaker 1: a teed under one hundred billion in ken We say

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Speaker 1: is right. And the point is that this super fund

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Speaker 1: is generating returns of about ten percent perannum, and one

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Speaker 1: percent of that would be eighty million. So paying thirty

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Speaker 1: two million towards our New Zealand super and reducing the

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Speaker 1: tax burden on the government or allowing that thirty two

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Speaker 1: million to be spent on health or education or pay

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Speaker 1: parity or whatever would actually benefit the government in terms

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Speaker 1: of its fiscal position, but wouldn't damage the super fund

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Speaker 1: at all. And as I say, that's exactly what this

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Speaker 1: fund was set up to do, to reduce the cost

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Speaker 1: of New Zealand Super. As our population ages and we

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Speaker 1: live no longer.

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Speaker 2: Okay, interesting, I'm thirty years away, I make calculating from

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Speaker 2: retirement age. By the time I get there, will New

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Speaker 2: Zealand Super exist? Do you think so?

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Speaker 1: Our question, because of this fund and because of the

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Speaker 1: system we've got now, one of the key issues is

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Speaker 1: whether they put the age up to seventy, make you

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Speaker 1: wait another five years. You've got to work for other

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Speaker 1: five right, But in atual fact, now with the health

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Speaker 1: costs and the changing population that we've got with mor

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Speaker 1: Mari Pacifica, we think that the age of retirement should

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Speaker 1: stay at sixty five. So the less moving of the

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Speaker 1: goldpost they do, the better, but the less texts they

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Speaker 1: take out during the accumulation phase the better too.

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Speaker 2: Jonathan Erickson, Superannuation and Super Fun Expert.

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Speaker 3: For more from Early Edition with Ryan Bridge. Listen live

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Speaker 3: to News Talks at b from five am weekdays, or

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