People enrolling in KiwiSaver from today will no longer be entitled to the $1000 kick-start from the Government.
In today's Budget, Finance Minister Bill English announced the extra Government funding will cease as of 2pm, citing the "considerable cost" to taxpayers.
The 2.5 million Kiwis enrolled in the programme have together received $2.5 billion from the taxpayer since it started in 2007. Mr English says it can't go on.
"It was always there to attract people to a new scheme," he said. The uptake of the scheme had been successful, he said.
The Government will spend more than $850 million this year on two KiwiSaver-related subsidies – the ongoing $521 a year per member and the $1000 kick-start funding when people sign up.
Mr English claims axing the initial boost for new members will save more than $500 million over four years, and the money reinvested in this year's Budget into priority public services.
Those already enrolled aged 18 or over or under 65 will continue to receive the $521 member tax credit.
In most cases, employers will still be required to contribute 3 percent of an employee's gross wage or salary, and employees will continue to make their own contributions.
source: newshub archive