KiwiSaver 'tinkering' has hit confidence in scheme
Thursday 18 August 2011, 6:14PM
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A banking specialist has called for both major political parties to show their support for the KiwiSaver scheme to boost public confidence.
Dr Claire Matthews was speaking after completing research that was commissioned by the Financial Services Institute of Australasia and the Institute of Financial Advisers.
The report KiwiSaver and Retirement Savings found that nearly 30 per cent of non-members said they had not joined because they were concerned a future government would change the rules and 21 per cent feared a future government might abandon the scheme.
Dr Matthews, of the Centre for Banking Studies, says New Zealanders don’t trust the government not to change the KiwiSaver scheme.
“Given there have been two changes since KiwiSaver was introduced in 2007 that’s not all that surprising,” Dr Matthews says. “However, this is a key reason given for not becoming members, and therefore the government needs to overcome those concerns. In my view the only way that will happen is if the political parties agree not to further tinker with the system.”
Over a fifth of respondents said they were worried about the government’s ability to manage money, which reflects a lack of understanding in the scheme as savings are held with private providers.
Dr Matthews, who is a board member of the New Zealand Centre for Personal Financial Education founded by Westpac New Zealand and Massey University, designed the survey and analysed the findings, with data collected by UMR Research.
It aimed to gauge perceptions of KiwiSaver, the importance of saving for retirement, where they obtained advice and views on the changes to KiwiSaver in the 2011 Budget.