NZ Herald
  • Home
  • Latest news
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather forecasts

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
    • The Great NZ Road Trip
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
    • Cooking the Books
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • What the Actual
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Business / Companies / Aged care

Election 2023: Experts say giving KiwiSaver members more options could be costly

Jenée Tibshraeny
By Jenée Tibshraeny
Wellington Business Editor·NZ Herald·
18 Aug, 2023 04:16 AM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Reactions split on the Government’s draft transport plan, why the immigration minister is ordering a review of the work visa scheme and one of the most recognisable faces on British television, Sir Michael Parkinson, dies at 88. Video / NZ Herald / Getty

National’s proposal to allow KiwiSaver members to invest through more than one provider is being met with scepticism by industry experts.

National is campaigning on allowing members to invest through up to two or three providers.

Currently, members can split their investments across different funds (eg conservative, balanced and growth) offered by the same provider.

Those who would like more diversity can use services offered by the likes of InvestNow and AMP, which enable members to invest in funds offered by a selection of providers they have relationships with.

Advertisement
Advertise with NZME.

The main thing is, members’ contributions need to initially go to one, not multiple providers.

National wants to give KiwiSaver members more choice, which it believes would drive innovation, competition, and lower fees.

While some of those the Herald spoke to could see merit in the concept, they worried changing the rules would create complexity, and therefore cost.

Fundamentally, they also questioned whether there was a need for change, given there’s room within the existing law for providers to innovate to cater to engaged investors seeking greater diversity.

Advertisement
Advertise with NZME.

For example, Sharesies is working on a KiwiSaver offering, which would allow members to allocate a portion of their portfolios towards individual company shares and exchange-traded funds (ETFs).

Milford head of KiwiSaver and distribution Murray Harris recognised the options already available in the market and asked the question: “What is the problem it [National] is trying to fix?”

Harris said KiwiSaver members often struggled to choose between the handful of funds offered by a single provider, let alone funds offered by other providers too.

He believed they would need financial advice if presented with too many options.

Furthermore, Harris said it would be harder for members to measure how their retirement savings were tracking if they had to check in with a few providers.

Simplicity co-founder Sam Stubbs believed giving members more choice was a good thing in principle.

But he feared the additional administration required could push up costs, which would ultimately be borne by members.

Some of the administrative burden would fall on providers, and some would fall on Inland Revenue, which collects members’ contributions from their employers before passing them on to their KiwiSaver providers.

Advertisement
Advertise with NZME.

Stubbs appreciated the argument National’s Commerce and Consumer Affairs spokesman Andrew Bayly made, that giving members more options would spur innovation.

Bayly noted members might be more inclined to look at alternative asset classes, like start-ups or build-to-rent housing, if they had the option of only making a small investment in these areas.

Indeed, Stubbs was open to creating more specialised funds if KiwiSaver members had the option of diversifying their investments more.

He said data sharing between providers might be required to enable members to easily track how their investments were going in totality.

Massey University Business School associate professor Claire Matthews was “disappointed” National wanted to fiddle with KiwiSaver in a way that “doesn’t make a useful contribution”.

She cited similar concerns to those expressed by Stubbs and Harris around complexity, administrative costs, and the fact there are already ways members can achieve diversity.

Matthews didn’t buy the argument that limiting the number of providers someone could invest through would alleviate the administrative burden. Indeed, if the limit was set at two or three providers, members might push for more options.

She said KiwiSaver was meant to be simple and low-cost.

OliverShaw tax advisory director and former Inland Revenue deputy commissioner of policy, Robin Oliver, believed diversity was a good investment principle.

His concern with National’s proposal was around policing whether members contributed enough to receive the government contribution.

The Government encourages contributions by paying members $521.43 a year if they contributed at least $1042.86 over the year.

Oliver worried it may be tricky for Inland Revenue to check in with various providers to see if members made sufficient contributions to qualify for the government payment.

Coming back to Harris from Milford, he didn’t want to see politicians tinkering with the KiwiSaver scheme, saying it should firmly remain a vehicle for retirement savings.

National, in July, also said that if elected to govern, it would allow people under the age of 30 to draw down on their KiwiSaver savings to help cover their bond payments for tenancy agreements.

“Getting together up to four weeks’ rent in advance for a tenancy agreement is not easy for many people, particularly for students and young graduates, who don’t have a lot of cash,” the party’s Housing spokesman Chris Bishop said.

Jenée Tibshraeny is the Herald’s Wellington Business Editor, based in the parliamentary press gallery. She specialises in government and Reserve Bank policymaking, economics and banking.

Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Latest from Aged care

Premium
Healthcare

Concern 'patients will suffer' as practices with 46,000 enrolled switch funder

11 May 08:50 PM
Premium
Property

First look: Inside stage one of new Wānaka retirement village

08 May 03:13 AM
Premium
Property

NZ's billion-dollar builders revealed as new king of construction emerges

30 Apr 05:00 PM

The Hire A Hubby hero turning handyman stereotypes on their head

sponsored
Advertisement
Advertise with NZME.

Latest from Aged care

Premium
Concern 'patients will suffer' as practices with 46,000 enrolled switch funder

Concern 'patients will suffer' as practices with 46,000 enrolled switch funder

11 May 08:50 PM

The centres say changing their primary health organisation will help avoid fee increases.

Premium
First look: Inside stage one of new Wānaka retirement village

First look: Inside stage one of new Wānaka retirement village

08 May 03:13 AM
Premium
NZ's billion-dollar builders revealed as new king of construction emerges

NZ's billion-dollar builders revealed as new king of construction emerges

30 Apr 05:00 PM
On The Up: He sold pine cones at 7 - now entrepreneur eyes $1b turnover

On The Up: He sold pine cones at 7 - now entrepreneur eyes $1b turnover

07 Apr 05:10 PM
Gold demand soars amid global turmoil
sponsored

Gold demand soars amid global turmoil

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • What the Actual
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven CarGuide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP