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National split on super?

Written By: - Date published: 7:09 am, October 19th, 2012 - 26 comments
Categories: john key, national, superannuation - Tags: , ,

Well colour me surprised. Signs of independent and rational thought in the Nat caucus?! The issue is superannuation and whether, with NZ’s changing population structure, super is affordable in its current form. We all know the background. Voters support change – raising the age of eligibility – and this was Labour’s policy going in to the last election.

The problem for the government, of course, is Key’s promise to resign rather than raise the age (one of the promises that he seems to have decided not to break or forget). So the Nats are running a government that is abdicating its responsibility to plan for (and give we the people time to plan for) the long term viability of our support for the elderly. Because of Key they’re stuck with it.

Or are they? One News was reporting last night what seems to be a split within National over the issue:

Key in the dark over superannuation review

John Key might think New Zealand can afford national superannuation the way it is, but others within his Cabinet seem to be questioning that stance.

… a growing number of economists feel that with an ageing population, national super is not sustainable as it is. And now one of Key’s own ministers wants the issue formally looked at by Retirement Commissioner Diana Crossan.

Key appeared surprised when ONE News asked him what he thought about Commerce Minister Craig Foss giving the Retirement Commissioner the go-ahead to look at the issue. …

In a letter to the Retirement Commissioner, Foss sets out the topics the Government “requires to be addressed in the 2013 review”, including the effects of people living longer on savings schemes, and the sustainability of national super.

Key told ONE News he does not know why Foss has asked that. “It’s also true that Treasury does a lot of work, but my view is that it is affordable and sustainable.” Labour MP David Parker hit back, saying: “Once again John Key doesn’t know what’s going on in his Government.”

Credit to Foss and any others who are backing him in this matter. Key’s foolish promise should not prevent the government from exploring the issues properly, and with Foss’s go-ahead that process can now take place.

Is this move an individual decision from Foss, or is he representing a faction within National that actually has a conscience and a concern for the principles of responsible government? I have no idea (being no kind of political insider!). But I do find it interesting that this minor rebellion, this faint flickering of independent and rational thought, has taken place at a time when Key is plummeting from grace faster than a Felix Baumgartner free-fall.

26 comments on “National split on super? ”

  1. One Tāne Huna 1

    Dear Craig,

    As you know I have pledged to resign rather than raise the age of eligibility for superannuation. If I do not resign over this I am now going to be forced to resign over something else; I have forgotten what it is though. This is not in the script.

    Can you see any way out of this?

    Sincerely,

    Slippery.

  2. lanthanide 2

    How come Eddie didn’t have a heads up on this, like he seems to continually know what’s going on with this supposed Collins vs Joyce business?

    [this isn’t Collins v Joyce, I don’t reckon. Just inept political management because the leadership doesn’t have its eye on the ball. Eddie]

  3. A further sign that Key’s days may be numbered?

  4. Raymond A Francis 4

    “Voters support change”, really, just because a poll shows support I think the last election (you know the one where Labour took a pasting) shows voters are quite against that and Capital gains tax
    That is not to say I don’t think we need these things, we do and I support them even though I am 2 years away from a pension that when it started was said to be taken from my tax and would be paid from age 60

    Wonder which party made the promises and which changed them?

    • One Tāne Huna 4.1

      No-one has even proposed changing your age of entitlement, let alone actually done so.

      I wonder which party failed to read the policy.

    • bbfloyd 4.2

      Apart from having what amounts to a rant exposing your lack of depth on this issue, and it’s history, what have you got to say that’s relevant? Because there are already enough ill informed shills coming on here and wasting space….

      And being utterly wrong on pretty much every claim you made doesn’t help your credibility either…

      • Lanthanide 4.2.1

        Are you ever going to contribute anything more to this site than claiming anyone you disagree with is incredibly stupid?

      • Rogue Trooper 4.2.2

        one city’s shill is another country’s shine 🙂

    • lprent 4.3

      Wonder which party made the promises and which changed them?

      Jez – perhaps you should have taken more notice of history when you were living through it.

      http://en.wikipedia.org/wiki/Social_welfare_in_New_Zealand#Superannuation

      The answer to both questions is National… They introduced national super in 1977 and changed the age of entitlement from 1992

      • Dv 4.3.1

        And the change was made 1991 to 61 and the to 65 from 1993 to 2001
        That was very quicly, compared to the change of 2 yrs in about 10 years.
        Ironically Peters super scheme was voted down in a referndum in 97?, i thnk because of trust issues.

  5. Tom 5

    “faster than a Felix Baumgartner free-fall” .. err, could you be a bit more precise ?

  6. karol 6

    I have long thought that we would be best to raise the super age further – that we should have done it earlier.
     
    However, I sometimes see comments saying that the current age for super entitlement is affordable for a long time yet – that the real problem is income inequality, hoarding of wealth by the few etc.  What is the evidence for this?
     
    I can see that freeing up paid work for younger people is a good thing.  But I also think there’s benefits to all for us oldies to gradually ease out of paid work – going to part time work, and possibly with less responsibilities than we had when younger.  Anyway, that’s the direction I’m headed.

    • RedLogix 6.1

      Alternately you could argue for the age to be lowered back to 60 … more people would retire sooner and open up opportunities for younger people.

      Or you could argue for a UBI … and be fair to everyone.

      • Lanthanide 6.1.1

        “Alternately you could argue for the age to be lowered back to 60 … more people would retire sooner and open up opportunities for younger people.”

        If you believe the lump of labour fallacy, yes.

        Many people still working when they’re 60+ have got skills and experience that can’t be replaced by younger people. That’s why they’re still employed.

        • Draco T Bastard 6.1.1.1

          lump of labour fallacy

          In economics, the lump of labour fallacy (or lump of jobs fallacy) is the contention that the amount of work available to labourers is fixed. It is considered a fallacy by most economists,[citation needed]

          At any one point in time a society only requires a fixed amount of labour done to support itself. Considering modern productivity this is generally far less than the amount of labour actually available. It is, IMO, this surfeit of labour that has given rise to the low paid Surfeit of Services that we’re seeing in western and other developed countries.

          • Colonial Viper 6.1.1.1.1

            The neolibs and capitalists have worked very hard to maximise a massive oversupply of labour by increasing what Marx calls the “Reserve Army of Labour” eg. by ensuring that the Chinese labour pool of 1.4B is free to take jobs from anywhere in the world.

            With ongoing increases in productivity and ongoing increases in unemployment, the answer is easy – restrict working hours to give more workers leisure time, so that other workers can get jobs.

            • karol 6.1.1.1.1.1

              restrict working hours to give more workers leisure time, so that other workers can get jobs.
               
              This has always seemed sensible to me.

  7. gobsmacked 7

    I reckon it’s just the usual forked tongue.

    Message to the Right … National is the party of responsibility, balance books, sure there were promises, but (nod, wink) we’ve broken those before, we’re looking at Super, trust us, we’ll change it, but we can’t say so out loud just yet, we might need Winston …

    Message to the swingers … I’m honest John Key, I made a promise, I’m keeping it, trust me

    Remember the 2020 taskforce? Don Brash’s meaningless expensive exercise? There are many ways to pretend to address an issue. It takes five minutes to come up with a form of words that says “Cut but don’t cut”.

    If National get a third term without Winston, the new PM will cut Super. If they need Winston, they’ll just kick it down the road for one more term. Everyone knows this, surely? The rest is “words, words, words …” (Hamlet).

  8. KJT 8

    Here we go again.

    “We cannot afford super”, welfare, (substitute any social or state provided service, infrastructure or payment) is a right wing meme. This one has been repeated so often that even the left, who should know better, are repeating it.

    Far from reducing super, which has been successful in reducing the rate of elderly poverty to one of the lowest in the world, we should be extending the successful model to everyone else in the form of a GMI.

    Those who want to cut super are effectively saying that New Zealand, still one of the worlds richer countries, and one of the richest in the resources required to feed and house people, intend to have their elderly begging on the streets.

    It is inequality that makes super hard to afford.

    It is easily affordable. If the half of the wealtheist who do not currently paid tax were assessed for tax on Gareth Morgan’s model it would pay for super and much more besides.

    http://kjt-kt.blogspot.co.nz/2012/06/on-new-zealands-retirement-income.html

    “The finance industry have been creaming their pants, for a return to the halcyon days, before the tax rebates were removed from superannuation savings. When they got to play with our money for free, and the negative returns and high charges were ignored, because of tax payer subsidies.

    Egged on by the neo-liberals who prefer the elderly, the unemployed and the sick to starve in the streets, as an incentive to scare working people into accepting starvation wages, while they continue to get 17% increases in wealth, the finance industry is dreaming of getting more of their sticky hands on our wealth, with private super funds.

    Since the 70’s they have been constant in the meme that we cannot afford super. A meme that has been driven entirely by the self interest of those, who are too wealthy to need super and too mean to pay taxes, and a greedy finance industry.

    Unfortunately, it is true, that if you repeat bullshit often enough, even those who should know better come to believe it.”

    • millsy 8.1

      +1

      New Zealand has the lowest rate of poverty for senior citizens in the OECD, we don’t have old people living in the streets, or having to flip burgers.

    • Draco T Bastard 8.2

      +1

      A Universal Income and proper taxing is what’s needed. Not this BS about not being able to afford to keep all of us in a reasonable living standard. That meme really does just come from the greedy who want all the societies wealth for themselves.

  9. Blue 9

    Geez, Craig Foss has a brain? I thought he wasn’t much good for anything except asking patsy questions in the House.

    • David H 9.1

      Now that really did come out of left field, Foss, who’d a thought it. Is this a straw too many on the camels back?

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