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Business Owners Report Low Kiwisaver Uptake

News Release
21 February 2008

Business Owners Report Low Kiwisaver Uptake

Two thirds of owners of mid-sized New Zealand businesses surveyed for the Grant Thornton International Business Report say that fewer than 10% of their employees have signed up for Kiwisaver.

In nearly 20% of cases, no staff at all have signed up. And only 6.7% have more than half of their staff on the Kiwisaver scheme.

The Grant Thornton survey also found that 54% of business owners felt the Kiwisaver scheme would have a negative impact on them, while 56% considered it would have either no impact or a negative impact for staff.

“These results are interesting because they would seem to point to either a general sense of disfavour or indifference to the scheme among many employers who are the owners of medium-sized businesses,” said Grant Thornton New Zealand spokesman Peter Sherwin.

“This is possibly an extension of their overall discontent with having to deal with so much Government-generated paperwork, red tape and the cost of compliance. The compulsory 1% employer contribution from April 1 will most likely create further irritation.

“On the other hand, the figures most likely also contain an element of lack of interest in Kiwisaver from employees.

“But whatever way you look at it, the initial response to Kiwisaver is not exactly stellar. And part of that could be that business owners see it as yet another burden for medium-sized businesses to shoulder.

“There is clearly the need for some work to be done yet to make Kiwisaver more appealing all round.”

Mr Sherwin said if there was some encouragement for the scheme, it lay in the fact that 42.7% of the business owners felt it would have a positive impact for their staff and 20.7% felt it would have a positive impact for them as employers.

The results were obtained from questions specifically for New Zealand businesses, contained within the wider international survey.

ENDS

About the IBR
The International Business Report surveyed more than 7,500 owners of medium sized businesses in 34 countries. In New Zealand, Consumer Link surveyed 150 businesses. For the purposes of the IBR survey, a medium-sized business in New Zealand was seen as employing between 10 and 149 people. The research was conducted by Experian Business Strategies Limited and Harris Interactive. All figures were correct at time of going to press. To find out more about IBR and to obtain details of IBR reports and results please visit www.internationalbusinessreport.com.

About Grant Thornton International
Grant Thornton International is one of the world's leading organisations of independently owned and managed accounting and consulting firms providing assurance, tax and specialist business advice to privately held businesses and public interest entities. The strength of each local firm is reflected in the quality of the international organisation. All Grant Thornton International member firms share a commitment to providing the same high quality service to their clients wherever they choose to do business.

About Grant Thornton in New Zealand
In New Zealand, Grant Thornton has independent firms in Auckland, Christchurch, Dunedin and Wellington. From market-leading services for the owners of private businesses, to audit, to insolvency and capital markets services for corporations, and to innovative taxation and wealth management services for individuals, Grant Thornton in New Zealand helps business owners achieve success and realise their ambitions.

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