Negative household savings shows need for change

The revelation that Kiwi households are once again spending more than they earn demonstrates the need for universal KiwiSaver to bolster savings, says Labour Finance spokesperson David Parker.

“Statistics New Zealand’s National Accounts for the Year ending March 2013 shows that household savings are in the red by almost $1 billion.

“Internationally, New Zealand can’t afford to spend more than it earns. Over the long term that means we need to sell assets or borrow even more to fund the shortfall. Right now that shortfall is around $9 billion a year.

“We need to boost our savings culture, sadly National won’t address this issue.

“The best way to increase household savings is to make KiwiSaver universal. That will not only increase savings but it will also create a deeper investment pool for Kiwi businesses.

“Labour’s capital gains tax will ensure that investment is directed towards productive exporting businesses that will help boost our earnings overseas,” David Parker says.

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