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Killing the Cullen Fund’s costing us

Written By: - Date published: 7:58 am, January 8th, 2013 - 45 comments

David Shearer recently picked up National’s policy of not contributing to the Cullen Fund while the Government’s in deficit but there’s nothing about being in deficit that alters the case for investing the Cullen Fund. As long as the return exceeds the Crown’s cost of capital, it’s worthwhile. So, how much have the canned contributions cost us so far? $1.2b.

Don’t blame MMP for Nat stupidity

Written By: - Date published: 9:32 am, December 18th, 2012 - 18 comments

Recent pieces by Bernard Hickey and John Armstrong both highlighted the problem of our aging population and the unsustainability of super – in Hickey’s memorable words we are “consuming our future”.  Armstrong tries to balme MMP, but that won’t wash, it’s just the usual short-sighted Nat stupidity…

National split on super?

Written By: - Date published: 7:09 am, October 19th, 2012 - 26 comments

Foss has effectively challenged the PM’s stance on ruling out changes to the age of eligibility for NZ Super. A minor rebellion? A faint flickering of independent and rational thought form within the National caucus?

Hands on Labour

Written By: - Date published: 9:51 pm, August 16th, 2012 - 31 comments

Fresh ideas to grow a stronger manufacturing sector, on top of the major changes Labour has already signalled featured in a speech given today by David Parker to a union audience in Wellington. David Cunliffe was there too,  and I particularly liked the  discussion afterwards. The key players are receptive to good ideas and it looks like Labour will have a real alternative to offer at the next election.

The super disaster

Written By: - Date published: 7:09 am, June 12th, 2012 - 191 comments

On Superannuation Key is in a very strange position indeed, where keeping his word is doing him more harm than breaking it. It’s a disaster for the country.

Key’s future gets shorter

Written By: - Date published: 7:03 am, May 31st, 2012 - 60 comments

Budgets allocate money not just for 1 year, but for the next 4. When National says its putting $511m into education, that’s actually $128m a year over 4 years (less than inflation). So, it stands out like a sore thumb that National has promised to limit teacher loses at 2 per school for only 3 years. After that? Seems like Key doesn’t expect it’ll be his problem.

‘Dying off’?

Written By: - Date published: 7:07 am, November 16th, 2011 - 116 comments

Winston Peters is suggesting that in the transcript of the PM’s meeting with Banks, John Key made some derogatory remarks about the older New Zealanders that tend to support New Zealand First, along the lines of “not to worry [about Winston’s support] they’re dying off”. Slagging off older New Zealanders (ie. the ones that always vote) is a sure way to lose an election.

Could Key really be so clueless? Well yes, when you look at the excuses he’s trotting out – probably.

 

Hickey on how Key’s failing the kids

Written By: - Date published: 11:20 am, October 30th, 2011 - 15 comments

Dear Mr Key: “We are the generation born between 2002, when you became an MP, and 2011, when you won your second of four terms as Prime Minister. We wonder why you insisted on spending our inheritance to ensure you were voted back in.”… Bernard Hickey presents a chilling vision of the future. The way to avoid it is make sure that Key only gets one term.

Labour’s savings & retirement policy

Written By: - Date published: 6:37 am, October 28th, 2011 - 99 comments

Well, they said they were going to run this campaign on policy and make the bold moves, and Labour proved that with their savings policy. National is been left floundering. Brand Key is unraveling while Labour starts to dictate the play for the first time since Orewa. But the substance of the savings policy wants a closer look, it has both good and bad aspects.

Saving our future

Written By: - Date published: 9:13 pm, October 27th, 2011 - 76 comments

Labour’s savings policy is taking care of future generations by making KiwiSaver universal and compulsory for all wage and salary earners, by re-starting contributions to the New Zealand Super Fund, and by gradually increasing the age of eligibility for New Zealand Super from 65 to 67 over a 22 year period. Labour is taking the decisions that are right for tomorrow, rather than the easy option today.

Your PM at work for you

Written By: - Date published: 7:35 am, September 20th, 2011 - 38 comments

Two news snippets yesterday seemed to me to capture the essence of John Key PM.  First, his response to recommendations about super, and second his prognostications on the Christchurch insurance market.

The New Zealand age of aging in charts

Written By: - Date published: 12:17 pm, August 28th, 2011 - 21 comments

Like many countries worldwide, New Zealand has an aging problem. Digging around the available charts it isn’t hard to see why. But New Zealand has less of a problem than many developed countries because of the demographics of our Maori and Pacifica populations plus the continuing immigration. It is still pretty bad.

Compulsory Kiwisaver?

Written By: - Date published: 7:14 am, August 4th, 2011 - 39 comments

Good to see the government considering a move that would significantly boost KiwiSaver uptake – even if it does highlight their ideological inconsistency!

The case for raising super age

Written By: - Date published: 8:22 am, July 9th, 2011 - 69 comments

We are going to have to have this debate some time.  Maybe it will be possible now that Labour has shown how to stare down supposed “electoral suicide”.

So, borrowing to save makes sense afterall…

Written By: - Date published: 9:59 am, June 8th, 2011 - 29 comments

Do you remember back in the day when Bill English didn’t want to put any money into the Cullen Fund? Remember how we were smugly told that borrowing to save was foolish? Well, since then the Cullen Fund has made a fortune and, we know learn, the government has been borrowing to build up savings for the Christchurch rebuild.

Support for raising retirement age

Written By: - Date published: 11:36 am, May 30th, 2011 - 37 comments

A Herald poll asked people their views on raising the retirement age. Surprisingly, support was strong – 52.3% think the issue needs addressing. National whines the country is broke so they have to cut public services and sell assets, but super for 65 year olds alone costs $625 million a year. Will any party have the courage to take on super?

Cullen Fund cuts cost $334m

Written By: - Date published: 10:54 am, February 19th, 2011 - 24 comments

The limo issue reveals everything wrong with the Key government in microcosm: greedy, elitist, hypocritical, liars. Against the background of the failing economy, it’s one hell of a bad look. But in monetary terms, it pales in to comparison beside their decision to cancel Cullen Fund contributions, which has now cost $334 million.

When I’m 67

Written By: - Date published: 12:16 pm, December 8th, 2010 - 54 comments

I’m in favour of lifting the retirement age. Life expectancy continues to rise and is now 80.4 years. A man aged 65 can expect to live on average another 18 years, a woman 20. That’s a hell of a long time to be getting the pension and an enormous cost. Rising the age to 67 would free up $1.5 billion a year to go into education and preventative health.

Democracy is bad at hard problems

Written By: - Date published: 7:15 am, December 8th, 2010 - 71 comments

Democracy can be very bad at dealing with hard problems.  Case in point, the Nats’ appalling handling of the issue of our ageing population.  The Nats are stuck, so the country is stuck, rabbit in the headlights, while the size of the problem continues to grow…

Nats’ ideology costing us millions

Written By: - Date published: 11:24 pm, October 19th, 2010 - 37 comments

This post isn’t about National cutting education at every level, which will damage our country for decades to come. Nor is it about how they’re cutting cost-efficient preventative medicine to fund ‘sexy’ elective surgery. It’s not even about how they’re pouring billions into holiday highways in the era of peak oil. This is about the Cullen Fund.

Killing the golden geese

Written By: - Date published: 9:26 am, October 16th, 2010 - 42 comments

National is developing an agenda for privatisation.  It’s crazy.  State owned assets are generating some rare bright spots in an otherwise dismal sea of poor economic news.  So why would any rational government sell ACC (or other state owned assets)?  Why would any rational government be cutting back on the Cullen Fund?  Why are the Nats determined to kill the golden geese?

Compulsory super savings welcome but…

Written By: - Date published: 10:07 am, August 16th, 2010 - 17 comments

Odd to see in the Sunday-Star Times that the Government is looking at introducing compulsory superannuation savings. After all, this is the same government that gutted Kiwisaver and the Cullen Fund just a year ago. Hmm, have they seen the light? Somehow I doubt it. The Nats see compulsory super savings as a replacement for the universal superannuation we have now.

Retirement age

Written By: - Date published: 7:18 am, July 23rd, 2010 - 17 comments

Brash’s call for a “flexible pension” is the thin end of the wedge leading to a rise in the age of eligibility for super. At the moment National are rejecting his call, as Key would be obliged to resign if the age is raised. But the problem remains. National have weakened Labour’s Cullen fund and KiwiSaver, and they seem to have no ideas of their own…

The brains deficit

Written By: - Date published: 10:57 am, May 11th, 2010 - 4 comments

A headline on Newsroom caught my eye a couple of days back: “Deficit Falls Further”. Good news, so, well done the Nats? Turns out no, not so much…

Nat stalking-horse’s attack on Cullen Fund falls flat

Written By: - Date published: 8:48 am, May 10th, 2010 - 23 comments

Michael Littlewood, the Government’s anti-Cullen Fund stalking horse, is back – arguing we should wind up the Cullen Fund. The numbers are clear. The decision to cancel contributions to the Fund has cost New Zealand $48 million so far. If the Fund was canned last June like Littlewood wanted, we would be more than $2.9 billion worse off. Tip: never let this guy help with your home finances.

English & Key cost us another $18mil

Written By: - Date published: 9:59 am, April 22nd, 2010 - 34 comments

The other week Vernon Small said that canceling the Cullen Fund contributions was “a dumb, short-sighted decision that has cost the fund heaps in the long run“. Hell, don’t worry about the long run just yet, Vernon, it’s been only 8 months. And the losses are accelerating. Last month the Nats cost us a further $18 million – that’s basically a million a work day.

Nat-onomics: $30 million up in flames

Written By: - Date published: 1:15 pm, April 17th, 2010 - 10 comments

Vernon Small calculates that if the Cullen Fund had continued getting its monthly contributions, rather than just the one-off $250 million the government gave in July, we would be $30 million better off by now. Predictably, the financially illiterate Key apologists are having a cry about being shown to have stuffed this one up so badly.

Restart Cullen Fund payments

Written By: - Date published: 7:17 am, April 16th, 2010 - 23 comments

It’s time for the Nats to reverse what Vernon Small (with 20/20 hindsight) has labeled the “dumb, short-sighted decision” to can contributions to the Cullen Fund. We’ve already lost $25 million and Treasury says we’ll lose billions more. If we don’t make this investment now, superannuation will become unsustainable sometime after 2030. Perhaps that’s the Nats’ aim.

Kick in guts for recesson victims

Written By: - Date published: 9:59 am, March 3rd, 2010 - 10 comments

The recession has forced tens of thousands of people out of work. There are now 276,000 jobless Kiwis. The lucky ones (only a third of the officially unemployed) can get the unemployment benefit. Now, the Government is letting inflation eat into their meager benefit payments. Benefit payments are meant to be adjusted for inflation. This […]

Shifting the centre

Written By: - Date published: 8:05 am, November 30th, 2009 - 51 comments

Well the productivity task force is reporting back today and some of their ideas have been forward released. As we expected they are a grab-bag of unpalatable, short-sighted and frankly mad measures from the loony right including putting interest back on student loans, flat tax and means testing free childcare. As the official announcement comes […]

Key & English lose us $21mil in 3 months

Written By: - Date published: 3:23 pm, November 4th, 2009 - 40 comments

Back in February, former currency speculator John Key and former Treasury adviser Bill English started talking about suspending contributions to the Cullen Fund, which was set up to help fund superannuation. ‘It’s losing so much money’, they wailed. Some people pointed out that the markets were already recovering, that investments could now be bought at […]

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