Employees are the current favourites in the KiwiSaver game, with the self-employed and other non-employees the underdogs. At first glance, National seemed to be levelling the playing field. But now it appears to be tilting the field the other way.
What's more, refereeing the game will turn into a nightmare.
Under National, the tax credit for employees is limited to 2 per cent of their pay. For non-employees, it's $1040 a year.
This means, for example, that a part-time worker earning $10,000 would receive a maximum tax credit of 2 per cent of that, or $200.
If that person quit work, their tax credit could be anything up to $1040, matching whatever they put in. Admittedly, they would have to contribute more in order to get the higher tax credit, but at least they would have that option.
This is unfair, and it matters. The tax credit is powerful. It doubles the money going into the KiwiSaver account, which means the total savings will be twice as big.
The administrative issues are equally worrying.
Under the present system, some time after June 30 KiwiSaver providers send to Inland Revenue a list of how much each of their members contributed during the July-June year, along with the date the provider received that member's first payment.
Inland Revenue then calculates each person's tax credit and sends the money to the provider to be credited to member accounts.
The process has already proven complicated. Two major providers have still not sent their lists to Inland Revenue for the year ending last June, says a spokeswoman.
She adds that she expects the system to be more streamlined next year, but that's hard to imagine if National is in government and doesn't change its policy.
English is optimistic. "On the administrative side, there may be some issues there. But if we're the government, of course, we would have the resources of Inland Revenue and the KiwiSaver providers" to sort through any problems.
He added, though, that Inland Revenue "do seem to be overburdened now with sorting out administrative issues".
If National is in power, presumably the department would have to ensure that each employee's tax credit didn't exceed 2 per cent of their July-June income. The mere fact that the KiwiSaver year is different from the April-March tax year would surely pose problems.
And with people entering and leaving the work force, and their pay levels fluctuating, it doesn't bear thinking about.
It's quite possible the added administrative costs could end up costing the government more than it saves by limiting the employee tax credit. Time for a rethink, Bill.