Grey Power Warns Of Impact of High Immigration Rates
Grey Power Warns Of Impact of High Immigration Rates From Asia and Africa On NZ Superannuation Base.
Grey Power is concerned about the impact on the underlying sustainability of NZ Superannuation by the current open immigration policy of the Government with its shift from traditional immigration sources to large numbers of migrants coming from Asian and African countries who do not have reciprocal pension agreements with New Zealand.
“Now that the superannuation debate is back in the political arena it is important to recognise that a major contribution to the cost of New Zealand superannuation is being made by countries such as the UK, Australia, Canada, The Netherlands, Greece and the Pacific Island countries where New Zealand has a formal cost sharing arrangement on pensions for people who have lived in both countries,” said Mr Roy Reid, President of Grey Power New Zealand.
“With increasingly high immigration levels from non-traditional countries such as China, Korea, India, South Africa and Zimbabwe where retirement pensions schemes like New Zealand’s do not exist, and there are no reciprocal offset agreements in place, there are already stresses developing with blending older people who have come to New Zealand late in life into the New Zealand Superannuation system.
It is not only the increasing cost of providing pensions to older immigrants in New Zealand, but the flip side of increasing contributions to other countries because of the large number of New Zealanders leaving to settle in Australia and other places.”
Mayor Len Brown’s Auckland is predicted to have a majority Asian, largely Chinese, population by 2040, with the existing long standing European ethnic and cultural base becoming a minority. This means that a very large percentage of Auckland’s projected 2.1 million population will have a short working history in this country with low associated tax and Kiwisaver contributions, and a rapidly escalating number of older people moving onto New Zealand Superannuation with no contribution coming from their original home countries.
Current eligibility requirements for New Zealand Superannuation require immigrants to be NZ citizens, or permanent residents, and to have lived in New Zealand for ten years after the age of 20.
“This is a generous threshold” said Mr Reid, “and its affordability may need to be reviewed. Chinese immigrant families have a particularly difficulty as the Chinese Government One Child policy has led to young families having up to four parents and other family members to support in their older age, an important and commendable responsibility in their culture. Consequently many older Chinese people are following their sons and daughters to New Zealand as part of this country’s Family Re-unification programme.”
“It is absolutely critical that the older immigrants who are here now get a fair go which is the time-honoured Kiwi way as leaving home at an older age to a new country and culture is tough enough without financial problems as well, but the ongoing cost of increasing numbers may well be unsustainable.”
Grey Power asks that the eligibility thresholds for access to New Zealand Superannuation be reviewed as part of the overall superannuation sustainability debate, and recognises that changes will have to be made for immigrants from countries with no reciprocal pension cost sharing agreements.