KEY POINTS:
National is promising to keep compulsory employer contributions to KiwiSaver if it wins the election, after an embarrassing mix-up forced its leadership to disown a contrary statement from a backbench MP.
For months National has refused to outline its plans for KiwiSaver, which was turbo-charged by Labour in
last year's Budget, when it added compulsory employer contributions and increased government help for savers.
But yesterday, National leader John Key was forced to reveal that his party would retain compulsory employer contributions after his MP Kate Wilkinson told a business breakfast the opposite thing earlier in the morning.
"We haven't finalised our KiwiSaver programme yet, but there will be compulsory employer contributions," Mr Key said.
"They're likely to be at pretty similar levels to what is outlined in the legislation at this point."
Mr Key said he was frustrated that Ms Wilkinson had "got it completely wrong", but she was not involved in designing National's KiwiSaver scheme.
Ms Wilkinson was asked about her party's position on compulsory employer contributions during a breakfast at the Backbencher pub early yesterday, and said National was not a party that supported compulsion.
Around lunchtime she issued a statement saying she had misinterpreted a question, and her comments were wrong.
But others present at the breakfast said the question to Ms Wilkinson was quite clear.
United Future leader Peter Dunne said he had been sitting next to Ms Wilkinson, and the question from a member of the audience was "remarkably unambiguous".
Labour Cabinet Minister Trevor Mallard, who was also at the breakfast, said he wrote down Ms Wilkinson's response at the time because it clearly showed National intended to abolish the employer contributions.
The untidy affair has effectively led to a situation where National has committed itself to adopting a policy which Finance Minister Michael Cullen estimates could suck $2.4 billion out of government coffers over the next four years.
The cost to the Government from employer contributions comes through tax credits that Labour pledged to pay employers to help them offset the costs of contributing to a worker's KiwiSaver account.
National has now moved to adopt - or neutralise - several of Labour's policy positions, including interest-free student loans, the first stage of Working For Families, the nuclear-free stance, ownership of Kiwibank, and retaining the New Zealand Superannuation Fund.
KiwiSaver has more than 600,000 members, and Labour said the numbers lifted when the employer contribution kicked in.
Labour seized on National's mistake yesterday as evidence that its opponent was trying to find ways to trim spending so it could pay for bigger tax cuts.
Dr Cullen said a tax cut couldn't possibly match the amount an individual would lose if National got rid of the employer contributions.
He also called on Mr Key to be absolutely clear on what he was keeping in KiwiSaver, because it remained uncertain whether National was promising to retain the full $2.4 billion worth of commitments over four years.
"Just as National has finally started answering some questions on KiwiSaver - albeit accidentally - John Key has started raising new ones," Dr Cullen said.
WHO IS KATE WILKINSON?
* A 50-year-old National Party list MP from Canterbury.
* A former Christchurch lawyer who was raised on a mixed cropping farm.
* Entered Parliament in 2005, was promoted by John Key and now ranks 28 in National's caucus.
* Holds the labour and industrial relations portfolio, with consumer affairs and an associate justice spokeswoman role.
* Has not been a high-profile MP, but has been delivering speeches in her various roles and asking questions of ministers in Parliament.