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Speaker 1: The fiscal hole is back again. This time it's from

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Speaker 1: the Greens. They reckon they found a seven hundred million

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Speaker 1: dollar hole in the government's twenty twenty five budget. They

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Speaker 1: reckon the government hasn't costed for the amount it will

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Speaker 1: have to pay its public service employees when the key

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Speaker 1: we save employer contributions go from three to four percent.

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Speaker 1: Brad Olsen is the principal economist Informetrics and been taking

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Speaker 1: a look at it.

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Speaker 2: Hallo, Brad, good evening.

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Speaker 1: So it's there, But is it a mini hole or

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Speaker 1: a maxi hole?

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Speaker 2: Well, I feel like it's sort of a half talked

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Speaker 2: about hole in a sense because the government and Treasury

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Speaker 2: have noted some of the lack of costing effectively in

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Speaker 2: some of the fiscal Risks section of the budget update,

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Speaker 2: and that's only because the government doesn't want to prejudice

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Speaker 2: their position. They're going to at some point go into

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Speaker 2: negotiations with employees around this and other changes, and they

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Speaker 2: don't sort of want to have already said, well, look,

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Speaker 2: we've set aside all of this money and therefore that's

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Speaker 2: definitely how we're going to pay for it. So I

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Speaker 2: feel like it's a hole that sort of hasn't been

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Speaker 2: fully costed out, but certainly hasn't being completely forgotten about either.

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Speaker 2: The government has just got to work out over the

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Speaker 2: next couple of years as these changes come through, what

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Speaker 2: it effectively does to achieve it, just like I think

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Speaker 2: every other business across the country will be trying to

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Speaker 2: figure out. So there is a cost, it will have

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Speaker 2: to be met, but it's not being directly disclosed in

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Speaker 2: the budget figures.

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Speaker 1: Brad, there is something to this argument. Isn't that that

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Speaker 1: now that you have to up your key, the employers

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Speaker 1: have to up the key. We say, a contribution from

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Speaker 1: the employer. The pay rise that you get next to

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Speaker 1: you or whenever this kicks in twenty twenty eight or thereafter,

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Speaker 1: is going to be lower.

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Speaker 2: Yeah, that's effectively what the Treasury has estimated themselves. I've

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Speaker 2: said that they expect that, you know, I think something

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Speaker 2: like eighty percent of employers are likely to sort of

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Speaker 2: move in that way and figure out how to sort

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Speaker 2: of meet it. And I guess from that point of

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Speaker 2: view it might well be that, you know, the boss

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Speaker 2: the employers come out and say, well, look we were

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Speaker 2: going to give you, I don't know, a two thousand

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Speaker 2: dollars increase. We'll still give you that increase, but only

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Speaker 2: one thousand dollars of it will actually go to you

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Speaker 2: and your weekly pay. The other thousand is to meet

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Speaker 2: the additional contributions that we've got to make on your kiwisaver.

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Speaker 1: That's I think.

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Speaker 2: I mean, we see a lot of these conversations play

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Speaker 2: out across employees and employers and it will be a

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Speaker 2: horses for courses argument. Again, that's probably what the government

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Speaker 2: will have to do as well. They'll say, well, look

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Speaker 2: we're going to give you more pay. It's just that

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Speaker 2: more of your pay now gets saved as well. And

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Speaker 2: that's where it's all coming from. Sort of one total bucket.

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Speaker 1: Okay, you have twenty seconds to tell me what your

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Speaker 1: problem with me is on superannuation, that we.

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Speaker 2: Should approach superannuation like every other benefit we seem to

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Speaker 2: there's a bit of means testing. There's not all that

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Speaker 2: much universality in it.

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Speaker 1: Okay, thank you very good. That was probably only like

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Speaker 1: seven seconds. Thank you, Brad brad Olson. Infametrics principle economs.

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