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

Gordon Campbell:
On The Team Behind Trump's Throne

Forget the Putin factor. Daily, the team of charlatans, bigots and stunningly ignorant crackpots that Trump is appointing to head key federal agencies is just as alarming. These are positions with vast power and budgetary discretion over policies that stand to affect tens of millions of vulnerable Americans. Sad! More>>

 

Gordon Campbell: On Bill English, Abroad

If David Cameron was the closest thing John Key had to a political mentor, their successors also share a whole lot in common. Theresa May and Bill English were both propelled into the top jobs as the result of unexpected resignations, and without much in the way of credible competition from their colleagues... More>>

ALSO:

Pike River: Labour Bill To Override Safety Act For Mine Entry

“Bill English has been hiding behind the legal excuse that any attempt to re-enter the mine to recover the bodies might place the mine’s owner, Solid Energy Limited, and its directors in breach of the Health and Safety at Work Act 2015." More>>

ALSO:

Gordon Campbell: On Populism And Labour 2017

For many people on the centre-left, populism is a dirty word, and a shorthand for the politics of bigotry. In this country, it has tended to be equated with the angry legions of New Zealand First. Who knew they were not just a reactionary spasm, but the wave of the future? More>>

Oxfam: 30% Of NZ Owns Less Wealth Than Our Two Richest Men

The research also reveals that the richest one per cent have 20 per cent of the wealth in New Zealand, while 90 per cent of the population owns less than half of the nation’s wealth. The research forms part of a global report released to coincide with this week’s annual meeting of political and business leaders at the World Economic Forum in Davos, Switzerland. More>>

ALSO:

Hospitals: Resident Doctors Set To Strike Again

Despite discussions between the DHBs and NZRDA over safer hours for resident doctors progressing during the last week, the strike planned for next week appears set to proceed. More>>

ALSO:

Not So Super Fund: More Burning Ethical Questions For Steven Joyce

Greens: Radio New Zealand reported this morning that the New Zealand Superfund has $77 million invested in 47 coal companies that the Norwegian Government’s Pension Fund – the largest sovereign fund in the world – has blacklisted. More>>

Activism: Greenpeace Intercepts World’s Biggest Seismic Oil Ship

Greenpeace crew have made contact with the world’s biggest seismic oil ship after travelling 50 nautical miles on two rigid-hulled inflatables off the coast of Wairarapa... Greenpeace radioed the master of the Amazon Warrior to deliver an open letter of protest signed by over 60,000 New Zealanders. More>>

ALSO:

Gordon Campbell: Why Tax Cuts In 2017 Would Be A (Proven) Bad Idea

Ever since the world fell prey to the mullahs of the free market in the 1980s, no amount of real world evidence has managed dispel one key tenet of their economic faith. Namely, the idea that if you cut income taxes and taxes on small business, a wave of individual enterprise and entrepreneurial energy will thus be unleashed, profits will rise and – hey bingo! – the tax cuts will soon be paying for themselves ... More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news