KiwiSaver Default Provider RFP Opens
The Government has today released the Request for Proposals (RFP) to appoint the next set of KiwiSaver default providers.
“The current nine default providers were appointed in 2014, and the tender process will help determine the next set of providers to be in place by December 2021,” says James Hartley, General Manager, Commerce, Consumers and Communications at the Ministry of Business, Innovation and Employment.
“People who don’t actively choose a fund when they join KiwiSaver are allocated to default providers,” Mr Hartley says. “The aim of this RFP process is to ensure those funds work in the best interests of Kiwis who are in default funds, and to better reflect what people want from them.
“Earlier this year, the Government changed the default provider settings following consultation. The new settings are reflected in the RFP criteria that applicants will need to meet.”
The changes include:
- switching default fund settings from ‘conservative’ to a ‘balanced’ fund to improve the likelihood of increasing people’s returns in retirement
- requiring default providers to do more to engage with their members and help them make the right decisions for their circumstances
- incentivising default fund providers to charge reasonable fees by making fees a significant part of the overall evaluation during the tender process
- excluding funds that invest in fossil fuel production to help address the impacts of climate change and transition to a low-emissions economy
- transferring non-active default members of any provider that is not reappointed to one of the appointed default providers, to ensure these members retain the benefits of being in a default fund.
The RFP closes on 18 December 2020.
To view the RFP, visit the GETS webpage.