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

 


KiwiSaver contributions to increase from 1 April

Hon Bill English
Minister of Finance

Hon Peter Dunne
Minister of Revenue

27 March 2013

KiwiSaver contributions to increase from 1 April

Two important changes to increase KiwiSaver contributions take effect from 1 April, which will help to encourage a higher level of private savings among New Zealanders, Finance Minister Bill English and Revenue Minister Peter Dunne say.

From next Monday, the minimum employee contribution rate will rise from 2 per cent to 3 per cent. At the same time, compulsory employer contributions will also rise from 2 per cent to 3 per cent.

“They were among a number of changes announced in Budget 2011 to encourage higher levels of private savings, to make the KiwiSaver scheme more financially sustainable and to build a larger pool of local capital,” Mr English says.

“At the same time, they will reduce the need for the Government to borrow money to invest in KiwiSaver.”

Those Budget 2011 measures also included:

• Maintaining the $1,000 kick-start payment when new members join KiwiSaver.

• From 1 April 2012, removing the tax-free status of employer contributions, which from that date were taxed at the employee’s marginal tax rate.

• For the year to 30 June 2013 and beyond, the KiwiSaver member tax credit rate was halved from $1 to 50c for every dollar contributed by members, up to $521 a year.

“New Zealanders are already starting to save more and these KiwiSaver changes are expected to help raise national savings further,” Mr English says. “They will also reduce the amount the Government is borrowing, largely from overseas investors, to fund private savings.”

KiwiSaver membership and total funds invested continue to grow strongly.

Almost 2.1 million New Zealanders have accumulated $15.4 billion in KiwiSaver funds. They are forecast to grow further to around $25 billion by 2015, and to almost $60 billion by 2021.

Mr Dunne says the changes will ensure that KiwiSaver remains an attractive savings option that is financially sustainable into the future.

“KiwiSaver continues to be a popular savings options for a growing number of New Zealanders,” he says. “It is part of the Government’s wider programme to encourage genuine savings and reduce the need for extra government borrowing and debt.

“We believe that most people will find 3 per cent contributions affordable, and the employer contributions will continue to offer an attractive rate of return for the money employees put in themselves.

“We felt it was important to give workers and employers two years to plan for the increased contribution rates.”

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

No Charges: Outcome
Of Operation Clover Investigation

Police have completed a multi-agency investigation, Operation Clover, into the activities of a group calling themselves “The Roast Busters”. The 12 month enquiry focused on incidents involving allegations of sexual offending against a number of girls in the Waitemata Police district and wider Auckland area.

Following a lengthy and complex investigation, charges are not being laid by Police at this time regarding 8 incidents involving 7 victims and 5 suspects. More>>

 

Parliament Today:

UNICEF Report: NZ Cautioned On "Stagnating" Child Poverty

An international report by UNICEF has found that child poverty rates in New Zealand have barely changed since 2008, despite similar sized countries significantly reducing child poverty during the recent recession. More>>

ALSO:

Funding Report: Two Pathways For Transport In Auckland

Commissioned by Auckland Council, the group was asked to investigate two possible pathways for raising $300 million per year ($12 billion over 30 years) to pay for the improvements needed to help fix Auckland’s transport system. More>>

ALSO:

Pay Equity: Equal Pay Win In Court Of Appeal

CTU: The Court of Appeal has made a historic decision paving the way for a substantial equal pay claim for aged care workers. More>>

ALSO:

Gordon Campbell: On The TPP Finishing Line, And Amazon’s Woes

If the Trans Pacific Partnership trade deal wasn’t such a serious matter, this would be pretty funny… More>>

ALSO:

TV3 Video: Three Die On Roads Over Labour Weekend

The official holiday period ended at 6am Tuesday, with three deaths on the roads during the Labour Day weekend. More>>

Employment Relations Bill: Govt Strains To Get Tea Break Law Through

The Government has been left with egg on its face - failing to get its much-vaunted, but hugely unpopular, meal break law passed in the first week of its new term, Labour spokesperson on Labour Issues Andrew Little says. More>>

ALSO:

Guns: Police Association Call To Arm Police Full Time

"The new minister gave his view, that Police do not need to be armed, while standing on the forecourt of parliament. The dark irony was that the interview followed immediately after breaking news of a gunman running amok in the Canadian parliament in Ottawa..." More>>

ALSO:

Gordon Campbell: On The Tokenism Of New Zealand's Role Against Islamic State

Our contribution against IS will be to send SAS forces to train the Iraqis? That’s like offering trainers to General Custer just as the 7th cavalry reached the Little Big Horn. More>>

ALSO:

Scoop Business: Shell And Todd Caught Drilling Without Approval

Multi-national oil company Shell’s New Zealand arm and local energy giant Todd Energy have breached the new law governing New Zealand’s Exclusive Economic Zone, the Environmental Protection Authority says in an Oct. 10 document released by the Green Party. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news