Constant legislative changes to KiwiSaver are adding costs to savers and superannuation funds, fund managers say, but they're seeking a few more changes to make it work smoothly.
The Association of Superannuation Funds of New Zealand (ASFONZ) yesterday commented on feedback from two forums held last week involvingnearly all of the providers of KiwiSaver schemes.
The Auckland and Wellington forums, held in conjunction with Inland Revenue, discussed issues of concern among providers to allow the smooth rollout of KiwiSaver changes and workplace savings schemes.
ASFONZ chairman David Ireland said providers were looking to the Government for a period of regulatory stability for KiwiSaver.
"Constant rule changes have been costly for providers, ultimately impacting on KiwiSavers through direct costs and through the extent of resources that providers have had to commit to accommodating the changes," he said.
Mr Ireland said while the Government should not rush further changes, it needed to address concerns about some unintended consequences of changes already made, and remove anomalies from the original KiwiSaver provisions.
"These include the risk of consumers losing their first home buyers' subsidy if they reduce their member contribution from the current 4 per cent to the 2 per cent rate from 1 April 2009.
"In addition, the KiwiSaver Act currently prevents providers from accessing relief mechanisms under the Administration Act to allow for the cost-effective release of small balances to a deceased's estate."
