Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Govt. Making Super Promises It Can't Keep

Sunday 26 November 2000

"The Government appears to be making promises about its superannuation fund that it can't keep," National Finance spokesperson Bill English said today.

"Treasury papers released today are concerning. They contradict the Government's position that its pre-funded superannuation scheme will rule out the likelihood of future tax increases.

"The Government says that any party that does not agree with the pre-funded scheme will have to increase taxes or cut pension payments.

"However, Treasury has told Government that even with pre-funding, taxes will have to increase or government spending will have to be cut," Mr English said.

"It is not clear which version of the fund these comments apply to because Dr Cullen changed the policy last week over how to deal with taxation of the fund."

In a discussion on how to avoid increasing debt by borrowing to make contributions for the fund, Treasury said: "Hence for the period after 2027 the conclusion to draw is that, regardless of pre-funding, some policy settings will have to change: taxes may need to be higher; spending may need to be re-prioritised."

"This reiterates the point that needs to be emphasised, that the pre-funding policy is by no means a complete solution to future increases in retirement income costs, or to potential changes in Crown finances more generally. It helps smooth the cost increase over time, but it cannot avoid the fact that, under current entitlements and with our best projections about future demographics, the long-term costs will be at a higher level than now."

"The fund starts paying out around 2025. So just as the fund is beginning to deliver its subsidy to pensions, the government of the day will have to be looking at increasing taxes or cutting spending.

"The Government has sold the fund as a way to guarantee future pensions at current levels without tax increases or spending cuts. That position was clearly not based on calculations or advice from Treasury. The Government appears to be making promises it can't keep," Mr English said.

© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Zimbabwe: New Democracy, Or A False Dawn?

Gordon Campbell: Robert Mugabe = Hosni Mubarak. The current jubilation on the streets of Harare at the fall of Zimbabwe’s dictator Robert Mugabe is genuine, and one hates to be negative about the country’s future. Yet the situation is eerily similar to the scenes in Cairo in early 2011, when a popular uprising swept Hosni Mubarak from power in Egypt. More>>


Gordon Campbell: On The New Pike River Agency (And The Air Strike Wing)

Much of the sympathy the public still feels for the families of the Pike River miners has been sustained by the sense that the previous government – let alone the mining company and the processes of receivership and litigation – has never dealt honestly, or fairly, with them. More>>


Not Going Swimmingly: Contractor Cut, New Dates For Christchurch Sports Centre

“As an incoming Minister, I have been conducting a thorough review of progress on the Anchor projects and to learn of a $75 million budget blowout on this project was very disappointing..." More>>


Tertiary: Allowances, Loan Living Costs To Get Boost

“From 1 January, student allowance base rates and the maximum amount students can borrow for living costs will rise by a net $50 a week,” says Education Minister Chris Hipkins... further adjusted from 1 April 2018 in line with any increase in the CPI. More>>


Foreign Affairs: Patrick Gower Interviews Jacinda Ardern

Prime Minister Jacinda Ardern says discussions have already begun on how to bring climate change refugees into New Zealand under a Pacific seasonal employment plan... More>>


Gordon Campbell: On The Centre Right’s Love Of ‘Nanny State’

You’d almost think it was 2005 again. That was a time when the rugged individualists of the centre-right were being beset by government regulations on the nature of light-bulbs, the size of shower heads, the junk food available at school tuck shops and other such essentials... More>>

Speaking Of Transport: Public Engagement On Wellington Scenarios

“Our work on possible solutions for Wellington’s transport future is ongoing, but has progressed to the stage where we’re ready to share our ideas with the public and seek their feedback to help guide our next steps...” More>>





Featured InfoPages

Opening the Election