Last June, only 53 per cent of New Zealanders under 65 were in KiwiSaver. Many people not in paid work, such as women at home with children and the sick and disabled, cannot afford to pay into it, and Mr Parker said a Labour Government could not afford to pay contributions for them.
Labour would raise the minimum KiwiSaver contributions from the current 3 per cent from employees and 3 per cent from employers to a total of 9 per cent.
At the last election it proposed 2 per cent from employees and 7 per cent from employers, but Mr Parker said he was now "open-minded" on the split.
"People seem to be happy with 3 plus 3, so 1.5 extra each might be easier," he said.
But Whale Oil blogger Cameron Slater wrote yesterday that saving 9 per cent of current income would be irrational for even fulltime young earners on the minimum wage because, after including universal NZ Super, they would end up with higher incomes in retirement than they earned now.
Mr Parker said Labour would exempt very low earners from compulsory KiwiSaver but the threshold would be set well below the fulltime minimum wage.
"Someone working small, irregular, part-time hours probably wouldn't be caught, but someone working 20 hours a week probably would be."
He said compulsory retirement saving would lift national savings and productivity enough to make everyone better off in the long term, as it had in Australia.
Compulsion would be phased in, probably starting with 1 per cent each in the first year and rising to 3 per cent each in the third year.