Saturday, 26 May 2007

The hidden stick of KiwiSaver

A Unionist writes:

I see that the latest NZ Herald-Digipoll found "....most still don't plan to join to begin saving for retirement."

Further the report goes on.

"A Herald-DigiPoll survey taken after the Budget has found that the prospect of employer and government contributions to participants' saving accounts is proving alluring - but only modestly so."

Despite the fact that two-thirds of people who took part in the survey were not in a retirement savings scheme, only 37.2 per cent of these "non-savers" said they intended to join.

Talking to workers I meet, there seems to be a feeling of resignation, about having to at some time having to sign up to this.

When I ask why, the answer is that they believe that the pension will not exist in the future.

When I ask why they feel that, they mention the many references to the unaffordability of the universal pension system that is seen as the accepted wisdom of the last few years.

Workers are not so much taken by the carrots offered, but can see the hidden stick.

Compare this general lack of enthusiasm from workers, to the EPMU's unconditional support for it, with the implied support for the Labour Government position stated by both Clark and Cullen at employer venues, that employers should resist any wage increases, presumably even to match inflation. (This as well as workers being asked to volunteer a 4 percent cut in their take home pay, on threat of penury on retirement.)


Unknown said...

Ah, the EPMU has quite clearly stated that the wage trade-off for employer contributions was its position *before* the major changes announced in this year's Budget. Note also their reiteration of this in their response to Air NZ's recent KiwiSaver announcement.

Labour has said state-funded super is safe, and this is just an optional top up. Bear in mind also that KiwiSaver will triple the savings of people on the lowest incomes.

Doloras LaPicho said...

Labour has said state-funded super is safe

Oh, so it must be true.