NZ Super 'sustainable for at least 30 years' - report

The Retirement Commissioner has recommended that NZ Super be left unchanged.
The Retirement Commissioner has recommended that NZ Super be left unchanged. Photo credit: Getty.

Kiwis are eligible for NZ Superannuation when they turn 65 - and people currently aged 35 and over can rest assured that by the time they get there, the cost is looking sustainable.

Although hiking up the age for NZ Super had been discussed in the past, interim retirement commissioner Peter Cordtz said that in a three-yearly review of retirement income policies, he has recommended that the NZ Super age be left where it is.

"Treasury projections show that the cost of Super is sustainable for at least the next 30 years and raising the age would do more harm than good," Cordtz said.

In addition to the Government pension being retained 'at its current settings', the review recommends several changes to KiwiSaver, including a 'small steps' employee contribution programme, employer contributions for over-65s and removal of 'fixed fees' for balances under $5000.

Tabled in parliament by Kris Faafoi, the review asks for greater power for the Retirement Commissioner to help Kiwis plan for their retirement.

"NZ Super and KiwiSaver are the two core planks of the public retirement income system, but they are supported by a wide range of Government policies that help New Zealanders learn, earn and house themselves as they move through their lives," Cordtz said. 

"Under the legislation, it is the role of the Retirement Commissioner to lead and monitor this policy work, but this office requires more resource and authority to do so effectively."

Submissions and focus groups showed that many Kiwis felt concerned about losing NZ Super and saw it as a backstop for their retirement.

"NZ Super is good value for money and its economic context has changed over time – it now looks affordable for the medium term, even though it did not necessarily look so in earlier years," Cordtz added.

NZ Super is currently available to Kiwis aged 65 or over, including New Zealand citizens, permanent residents and residence visa holders. People must have lived in New Zealand for at least 10 years after turning 20 and after turning 50, have lived in New Zealand or the Pacific Islands for at least five years.

The maximum pension for a single person living alone is currently $411.15 per week, or $316.27 per person in married/de-facto couples.

Cordtz is due to step down as interim retirement commissioner on February 10, at which time his successor, Jane Wrightson, will take over the position for the next three years.

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