KEY POINTS:
Many New Zealanders are not saving for their retirement and don't plan to join the Government's KiwiSaver scheme when it launches - but they want to be forced to save.
The indication that Kiwis are reluctant to fully embrace saving unless they really have to has come in
a Herald DigiPoll survey about retirement savings.
It found that over two-thirds of respondents were not currently in a savings scheme.
Of those non-savers, 23 per cent said they would join KiwiSaver when it launched on July 1.
That figure could be encouraging for proponents of saving, given that KiwiSaver's major information campaign is yet to kick off.
But in an interesting twist, 63 per cent of all respondents felt that saving for retirement should be compulsory.
New Zealand First leader Winston Peters, who yesterday made a strong pitch for compulsory saving, said some people knew they needed to be made to save.
"We know we should save - but it is easier to look the other way and spend instead," he said.
"Well the consequences of this can no longer be ignored."
The reluctance of New Zealanders to save has long been a source of anxiety for Finance Minister Michael Cullen and other proponents of saving.
Many people tie up their money in owning a home and see it as a form of retirement nest egg, instead of saving.
Dr Cullen said the country's savings levels were very low by international standards, and the results were being felt across the economy.
A weaker economic infrastructure, a shallower pool of local capital for development, pressures of "excessive" domestic demand on the economy and a chronic balance of payments deficit were all part of the resulting drawbacks, he said.
For now Dr Cullen is steering clear of compulsion.
His National Party counterpart Bill English is also talking down the idea of compulsion. He said many people cannot afford to save and should be concentrating on reducing their debt first.
"Taxpayers are already compelled to save through higher taxes put aside into the New Zealand Superannuation Fund, which is growing by more than $3 billion a year," Mr English argued.
The affordability argument around saving was echoed by Retirement Commissioner Diana Crossan, who said many families would probably find it difficult to make ends meet if they were compelled to put 4 per cent or 8 per cent into long-term saving.
She was encouraged by the number of people in the Herald poll who planned to join KiwiSaver.
Momentum for compulsory savings - or at least a slightly altered KiwiSaver scheme that would capture more people - is also coming from another of Labour's support partners, United Future.
Leader Peter Dunne said the idea deserved "serious consideration" by all political parties, workers and employees.
Investment Savings and Insurance Association chief executive Vance Arkinstall suggested that questions about affordability could potentially be answered by linking tax reductions to saving.
Mr Arkinstall conceded that saving was not easy, and that people felt so much pressure to spend on items for their homes that many just didn't get around to saving.
The Government could make employers put half of the corporate tax cut expected to be announced in May's Budget into a savings account for employees, Mr Arkinstall said.
"Some people will say that's small amounts and hardly worth it, but my answer to that would be that we have to start somewhere, we're best to start small and build up," he said.
