18 June 2001 Media Statement

Super bill amended to reflect NZF's concerns

"The New Zealand Superannuation Bill should now have the votes to pass after the Cabinet today signed off an amendment to reflect New Zealand First's concerns," Finance Minister Michael Cullen said.

New Zealand First wanted the provision in the Bill relating to the conversion of the Fund to an individualised scheme made tighter and more explicit.

Clause 73[3] currently states: If the House of Representatives resolves that consideration should be given to converting the balance in the Fund into retirement accounts for eligible individuals, the Guardians must report to the Minister [of Finance] and the Minister of Social Services and Employment, within 24 months of the date of the resolution, on options for doing so.

"The effect of the changes negotiated with Winston Peters and approved by the Cabinet are that the Guardians will have to report back within one year rather than two and that, instead of reporting on options generally, they should report specifically on the best means of allocating the Fund among individual accounts.

"The allocation would be to contributing taxpayers aged 18 or more and would be paid out according to the specific amount that person had paid in," Dr Cullen said.

"The Government acknowledges New Zealand First's track record of serious interest in the superannuation issue. This amendment recognises their position and ensures support to pass the legislation.

"It means we should now be able to get the legislation through this year and the Fund up and running. That is important because, until the Fund has been legislated for and the governance structures established, the money cannot be invested. It can only sit on the Government's accounts.

"I would therefore like to take this opportunity to thank Mr Peters and New Zealand First for their cooperation. I must emphasise, however, that our decision in no way indicates a shift toward support for individualisation.

"Labour and the Alliance continue to hold strongly to the view that individual accounts would prove unfair to women, low income earners and people with interrupted work histories," Dr Cullen said.

ENDS

© Scoop Media