Talk to any major KiwiSaver provider and they will say setting up the Government superannuation saving scheme has been a hugely expensive exercise.

Initial expectations were that it could take five years for most to break even. But in the latest KiwiSaver report by the Inland Revenue, released last week, that goal seems to have shifted even further.

"Most providers expect their KiwiSaver business to be profitable within 10 years," the report stated.

Bruce Kerr, chief executive of the Association of Superannuation Funds of New Zealand, said changes introduced by the National Government April 1 had increased the uncertainty.

Savers can now drop their contribution rate to 2 per cent, while employers have to contribute only 2 per cent instead of it rising to 4 per cent under previous legislation.

"That sort of thing will have a material impact on providers."

David Boyle, head of KiwiSaver distribution for ING - the largest KiwiSaver provider - won't even talk numbers but said the cost had been "big".

He is hopeful that the new 2 per cent minimum will see more people joining KiwiSaver but is mindful that it could also see contribution levels drop.

"And if they do that, we can't put our prices up."

He said it was too soon to know when ING would break even.

Tower chief executive Sam Stubbs said the changes made to KiwiSaver in its short life had made it more expensive than many expected.

Every time there is an alteration it costs Tower half a million dollars just to inform its members.

But not all providers expect to take so long to recoup the costs. Gareth Morgan KiwiSaver's Andrew Gawith said they had already broken even and expected to make a small profit this year.

He attributed that to being a fresh-start business and said many of the bigger players had to spend a lot of money on changing their systems.

The longer lead-in time for most means there is even more pressure for consolidation in the industry.

There are currently 31 providers and 54 schemes.

"There is a general feeling that 54 schemes is overdoing it for the size of the New Zealand market," said Kerr.

Stubbs goes one step further and puts a number on it.

"There will be between 10 to 20 providers within two to five years' time because a lot of providers are funding KiwiSaver from profits made elsewhere and those profits have gone away now."