Matthew Theunissen is a reporter for the Herald on Sunday.

Government avoiding super discussion - expert

Massey University director of academic programmes and retirement savings expert Dr Claire Matthews says the government is "burying its head in the sand" over superannuation.
Massey University director of academic programmes and retirement savings expert Dr Claire Matthews says the government is "burying its head in the sand" over superannuation.

The Government is "burying their heads in the sand" when it comes to New Zealand's superannuation, a retirement savings expert says.

Treasury yesterday released its long-term statement on New Zealand's fiscal position which projects the country's economic outlook over the next four decades.

It forecast that government debt could blow out to 200 per cent of GDP by 2060, in large part due to rising health and superannuation costs.

In that time, the cost of the country's super is projected to nearly double from 4.8 per cent to 7.9 per cent, according to Treasury.

Massey University director of academic programmes and retirement savings expert Dr Claire Matthews said the latest report came as no surprise.

"The reality is that a change that needs to happen ... [but] our current Government isn't prepared to even have that discussion.

"The experts and I'm talking Treasury here, and there are plenty of other people telling them that, and they're just burying their heads in the sand and refusing to accept that there's an issue here that needs to be dealt with."

She told Newstalk ZB the Government should consider the option available to it - raising the retirement age, paying people less, or restarting government contributions to New Zealand's superannuation fund.

Matthews did not advocate means testing to decide who could receive superannuation, which she said raised a whole lot of complications and ultimately made it more expensive.

"Keeping with the simple system but a system that allows for paying it out a at a later age is much better.

"The reality is we need to accept that most people can manage to work for another couple of years. At 67 they're just as capable of working as at 65 and in fact many people can be working quite happily until they're 70.

"Interestingly, it's actually the older people who are already recipients of New Zealand super and for who there would be no impact who are actually most opposed to it," Matthews said.

"In general younger, people accept that it needs to change."

- NZ Herald

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