Simplicity Kiwisaver Opens the Door for Foster Kids
Simplicity Kiwisaver Opens the Door for Foster Kids in New Zealand
Simplicity, NZ’s fastest growing KiwiSaver Scheme, has today offered KiwiSaver accounts free of annual fees to foster children.
Simplicity has been working with Clutha Southland MP, Hamish Walker, who yesterday introduced a Private Members Bill into Parliament, which allows foster parents to enrol children in their care into KiwiSaver.
Previously, only natural parents or legal guardians of foster children could enrol children in KiwiSaver. In effect, this meant very few, if any, have been enrolled, as many parents are absent, and legal guardians (usually the State) have had other priorities.
“The problem was brought to our attention last year by Megan Barclay, a foster mum, who had been frustrated at trying for years to open a KiwiSaver account for foster children in her care,” said Sam Stubbs, Managing Director of Simplicity. “Working with a dedicated group of volunteers at Simplicity and with the help of Voyce – Whakarongo Mai – we’ve supported Hamish Walker in his attempt to get a Private members Bill into the house to fix it,” said Mr Stubbs.
“Being able to open and maintain a long-term savings scheme like Kiwisaver is the right of every New Zealander,” said Megan Barclay, the foster Mum who contacted Simplicity.
“Removing these barriers is an easy thing to do, and will create some financial security for foster children, especially when their start in life has had many barriers and challenges already,” she said.
“Let’s make it easy to do and help make young people living in care equal to everyone else in New Zealand.”
The Chief Executive of Oranga Tamariki is the legal guardian for all foster children in New Zealand, and access is only possible through a social worker, who has hundreds of other priorities.
The Bill has the support of all major political parties to go to select committee. If the law passes, Simplicity will provide KiwiSaver accounts to all foster children free of annual member fees. A small fund management fee of 0.31% will apply.
Simplicity estimates its subsidy will be up to $187, 500 a year, depending on the number of children enrolled and their member balances. There are an estimated 6,200 foster kids in New Zealand.
“KiwiSaver is ideal for a foster kids. They typically go through 2-5 foster homes, and a KiwiSaver account can move with them,” said Stubbs.
“A child's bank account can be accessed by others but with KiwiSaver it’s protected.
“However, anyone including whanau, friends and extended family can gift the foster child KiwiSaver money, knowing it will be only for them”, he said. Simplicity now has 16,000+ members, saving them over $5.6m in fees each year, and giving over $240,000 p.a. to charity.