Tamsyn Parker

Tamsyn Parker is the NZ Herald's Money Editor

Labour: We will lift super age to 67

David Parker says the Census data backs Labour's decision. Photo / NZ Herald
David Parker says the Census data backs Labour's decision. Photo / NZ Herald

Labour would raise the age of eligibility for New Zealand Superannuation to 67, make KiwiSaver compulsory for employees and increase the KiwiSaver contribution rate if voted into power.

Deputy Labour leader David Parker told members of the superannuation industry his party was not afraid to tackle the age of eligibility issue despite it being politically challenging.

"I am willing to deal with the age of eligibility for superannuation. This is not populist politics."

Parker said the Census data released this week backed its decision. He pointed to the number of people in the 50 to 59 age group increasing by 22 per cent since 2006 to 989,000.

"Although the total population increased, fewer people are under 15 than in 2006 and this reinforces the need to address superannuation."

Paying for superannuation cost more than all benefits combined and within two years he expected it to exceed the annual spend on education. Labour has proposed raising the age of eligibility for New Zealand Superannuation from 2020 increasing it two months at a time to reach 67 by 2026.

But Parker said he was also mindful of the need to protect people who could not work beyond 65 - especially given many of those people were typically Labour voters.

He said it hoped to continue to support those who could not work after 65 in their normal occupation.

"We are not going to force people to work in a lower occupation. It will be on the basis of need." He estimated 5 to 10 per cent of those aged between 65 and 67 would be in that category.

The party would also make KiwiSaver compulsory for those in employment. It would be optional for the self-employed and those without an income.

The National-led Government put off automatically enrolling all employees in KiwiSaver because of the cost.

Parker said it would not drop KiwiSaver's incentives after making the scheme compulsory despite the added costs associated with keeping them.

Labour would also look to change the default setting from conservative to an age-appropriate one - a decision which the Government recently decided against.

- NZ Herald

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