Category Archives: Uncategorized

New Retirement Commissioner


Govt names broadcasting exec as new Retirement Commissioner

Jane Wrightson: Retirement Commissioner

NZ On Air chief, Jane Wrightson, has landed the plum Retirement Commissioner (RC) role in a move that sees a financial services outsider in the role for the first time.

Wrightson was named this morning as permanent replacement for Diane Maxwell, who finished her tumultuous term as RC this June.Peter Cordtz has been acting RC since Maxwell’s exit.

While Maxwell and her RC predecessors have had financial industry experience, Wrightson comes to the role with a long career in various broadcasting positions, dating back to a nine-year career as head of commissioned programmes for Television NZ starting in 1981.She was also chief film censor before taking up the deputy chief role at NZ On Air in 1994. After intervening chief executive jobs with SPADA and the Broadcasting Standards Authority, Wrightson returned to head NZ On Air in 2007.

In a statement, Commerce Minister, Kris Faafoi, said:“Jane’s experience in that key role within New Zealand’s multi-million dollar media sector has helped us grow our national identity and showcase it to the world.“NZ On Air connects New Zealanders and helps reflect what it is to be a New Zealander.“It supports inclusion and embraces our diversity through the local content it funds.

“The abilities Jane has shown in leading that work will neatly fit into the work she’ll be doing with the Commission for Financial Capability on a national strategy to help New Zealanders get ahead financially,” Mr Faafoi said.

Wrightson will take up the job from February next year.

Posted by Alec Waugh 1 November 2019

Changing approach to inheritance monies, but don’t be a martyr for your kids!

Be very careful. Be wary of perceptions that different generations have had it easier than others. Rose coloured glass’s  on  past memories , and fear re the future has always been the case.

Helping the kids earlier than past decades is a trend, but at what cost? Some research is saying parents are putting their retirement income at risk. Susan Edmunds provides advice!

Should you make your kids wait for their inheritance – or give it while you’re alive?

First home buyers have had to mortgage to the hilt to get into a first home.

Kāpiti Coast woman Sharon says giving her daughter a big chunk of her house was the sensible thing to do.

“I had my own home, mortgage-free and my daughter was living in it while I was living in my mother’s home. When my mum passed away, my sister and I inherited the house and I bought her out. My daughter wanted to buy her own house with her husband so I sold her a third of the house and gifted her two-thirds.”

Sharon did not want to be identified to keep the details of her daughter’s financial life private.

The deal meant her daughter, who does not work due to a health condition, and her partner were able to buy a house. She was her only surviving daughter, and it made sense to help her and her young family rather than making her wait, Sharon said

“They might as well have the use of it now rather than wait till I die. My mother lived till she was 92. I’m 70, it could be a long time.”It also meant she did not have to worry about maintaining and paying for rates and insurance on two homes.

“I look at the way the young kids are having to really struggle today.,.. there’s a hell of a lot of pressure on them.”An increasing number of people are opting to pass on an “inheritance” to their children while they are still alive, particularly in areas where house prices are high.

Martin Hawes, a financial adviser, said he saw people getting a lot of enjoyment out of doling out their children’s “inheritance” early.People needed to make sure that they did not give away so much that it left them short, said Martin Hawes.

 “If I die at 90, my children will be in their 60s and that’s the case with a lot of people who are having children later.”You’d hope by the time they are in their 50s and 60s they’ve at least bought a home and made fairly good progress. It’s not as helpful as it is to a 30-year-old. It hits the bank account at a time when it’s really useful.”

He said people needed to make sure that they did not give away so much that it left them short. “If you overdo the giving you can become a burden.Tom Hartmann, managing editor of Sorted, agreed people should check they had enough to fund the lifestyle they wanted throughout retirement.

“People typically underestimate how much they need and how long they’ll live. We recommend people run their retirement numbers so they go into it with open eyes and know what tradeoffs there are so they can make the decision.”People would often help their children buy a house, pay off a mortgage, pay for their university fees or help them set up a business, said Liz Koh.

Financial adviser Liz Koh said people would often help their children buy a house, pay off a mortgage, pay for their university fees or help them set up a business.”There are two key issues to keep in mind. Firstly, there is a need to consider any relationship property matters. It is important to get legal advice on this.

“Money given to a child may become relationship property if that child has a partner, and in the event that the relationship ends, the partner may have a claim on it. One way around this is to give the money as an interest free loan repayable on demand. The second major issue is one of fairness and equality.”Children, and for that matter grandchildren, can have a sense of entitlement and there can be rivalry between siblings if one is seen to be receiving more help than the others. Often such resentment doesn’t appear until after Mum and Dad have passed away.

“It is important to record any gifts or loans, and be as transparent as possible with family members to reduce any potential conflict when the estate is wound up.”Karen said it made sense to help her daughter when she could.There is no gift duty applied but if you give more than $27,000 in a year you could be declined a residential care subsidy if you were to apply for support to pay for a rest home.

Auckland woman Karen, who also wanted to keep her daughters’ details concealed, said her daughters had contributed a small amount of savings to the deposit for a rental property she and her husband bought. Now, six years later, the value of the property is being split between the two women to help them buy their first homes.There had been significant capital gains over those years, she said, which boosted the equity they were taking into their first property purchases.

Posted Alec Waugh, 17 October

NZ Super Costs

This 2018 article  is a real mixture of conjecture, fact and opinion. It illustrates the difficulty of getting  correct assessment of issues,  and a balance on both costs, political realities and model alignment. Keep in mind, NZ Super is taxable, most other OECD pension schemes are not, and the average OECD pension cost currently is over 8%, and our model is simple!


Posted October 7th




Amanda Morrall, author, financial educator and wellness advocate was a guest on News Talk ZB Sunday money show on Sunday June 16. An articulate speaker, she spoke about NZ Superannuation, immediately promoting the myth that NZ Super is unsustainable, pointing to the fact some OECD countries had or were changing the age of entitlement upwards, and hinting means testing and universality were areas where change was needed.

No mention was made that the educated camouflage income, using trusts and similar to avoid means testing regimes. If you want to advocate means testing, you must also advocate trusts and asset protection schemes are dismantled and all income is transparent.

Apart from the inherent bias of Amanda being associated with a managed fund company, she never mentioned that NZ Super is taxable, has one of the lowest costs in the OECD both currently and under future settings, and made no comment about future growth, productivity or societal adjustments affecting future costing. She was silent on the NZ Superannuation fund reducing fiscal costs associated with the payment of NZ Superannuation.

Amanda also spoke about many New Zealanders continuing to work, stating most NZ Seniors are healthy, able and wanting to contribute, and now living much longer. She glossed over the reality that again only the educated are likely to find productive work in their senior years, and coupled with the entrenched bias against senior productivity, the work issue for most is highly problematic.

She also misled many, by ignoring the fact, that the senior years are continuing to be dominated by health issues (quality of life) and this issue of life quality is far more important than the possibility of living between 1-3 years longer as each decade passes. A number of research projects are showing senior health problems continues as a huge issue, many people carrying significant problems, and this is unlikely to change over generations. Technology conditions, chronic neck and back issues, for smart phone users, will only add to the obesity, cancer, heart and stroke conditions that always exist.  Australian Bureau of Statistics, has recently lowered longevity trends.

Amanda is not alone with her sweeping generalizations, other economic commentator’s e.g. Cameron Bagrie have made similar statements, and NZ talk back hosts are notorious for their crisis rhetoric on the topic. Retired Retirement Commissioner Diane Maxwell has also fallen into the generalization trap


We know that about 40% of those receiving NZ Superannuation have no other income source, a figure which has been constant for a long period, and unlikely to change, even with the advent of Kiwi Saver.

Two of New Zealand’s eminent commentators Martin Hawes and Michael Littlewood have strongly supported the New Zealand Superannuation Model. Littlewood in a 2013 paper said” New Zealand Superannuation (NZS) is one of the simplest, most effective, and most cost effective Tier 1 schemes in the developed world. We mess with it at our peril” and Hawes said “NZ Super is a system so simple and cheap that we need to give people certainty and stop playing football with it”.

Little wood repeated his comment in 2018, statingthe net cost of NZS today is 4 per cent of GDP. That’s a lot but it’s among the lowest total public pension spending in the developed world. Our Treasury thinks that in 2060, 42 years away, that net cost will be about 6.7 per cent of tomorrow’s GDP.That’s a sizeable increase but to put that into perspective, the average before-tax public spend on pensions amongst all OECD countries in 2011 was 9.3 per cent of GDP (the net cost will be a little less). The 28-country OECD average spends on pensions today is somewhat more than we expect to spend in 42 years’ time. So  not a crisis – again, not even close.”

Why then is there such exaggerated rhetoric re pension unaffordability? The answer is the tabloid media approach of headlines rather than article substance, also a lack of research discipline by a number of commentators. Add in the poor knowledge by many of trends over time, limited historical analysis, and denial of the various policy lever options available on retirement income issues, when considering options or redress.

Roger Hurnard a New Zealand consultant on retirement issues succinctly reiterated, in an excellent paper(2011) entitled ‘Mixed messages: the future direction of New Zealand’s retirement Income policies’, that New Zealand Superannuation has a number of attractive features

  • It is extremely low cost in an administrative sense because it is funded out of general revenue, requires no individual contribution records to be kept and places no compliance cost on employers.
  • There is no cost in administering an income test or monitoring changes in financial or employment circumstances.
  • The absence of any employment or income test mans that there are no built-in penalties from earning additional income beyond eligibility age. The present value of future pension wealth embodied in the scheme is unaffected by when a workers chooses to retire. This feature helps to explain why New Zealand has one of the highest rates of labour force participation of older people in the OECD.
  • Knowing well in advance how much NZS will be worth proves a secure basis for people to judge how much additional income they need to plan for in order to achieve their own desired standard of living in retirement.
  • Standard amounts for each person signals fairness and promotes social cohesion.

The current scheme covers longevity risk efficiently by providing a known, fully indexed, gender neutral annuity. This is a critical contributor from New Zealand super as a form of annuity that covers longevity risk, particularly for women. ”. Susan St John, from the Retirement Policy and Research Centre, Auckland University Business School  emphasizes the gender fairness of New Zealand Superannuation,” it’s an equalizing force for women upon retirement”

Another positive difference for NZ pension affordability is that the future NZ pension fund bill will be partly offset by the NZ Super fund. When projecting NZ Superannuation costs long-term, I have yet to see any commentator off-set their cost projections with an assumption of the likely NZ Super fund contribution. Any improvement in productivity also cuts costs.

To me the issue is simply this. Nobody has been able to present a coherent and viable alternative to the current model, with costs, fairness and political realities addressed. The New Zealand Super model is a world leader, no alternative system comes within a bull’s roar of its overarching benefits across a range of indicators. Any cost saving requirements can be appropriately managed by any number of policy levers, with only minor adjustments, if any adjustment is considered necessary. NZ is the smart country re Retirement income.

Alec Waugh

Chairman of Kaspanz 9295604

Kaspanz submission to the 2019 Retirement Income Review

SUBMISSION FOR THE 2019 REVIEW (Kiwi Saver, Annuities, New Zealand Superannuation Protection Society Incorporated) is New Zealand’s only Consumer group with a focus on retirement income issues, formally incorporated since 2013, with an active website, updated weekly.

Kaspanz notes the announcement of the 2019 review and makes the following comments, all fundamental to a sound review and a caring society


The twin retirement income models are world -leaders, and New Zealand should be acknowledging this fact. The model is beneficial to women (not linked to employment salary scales) and being universal has kept the elderly from poverty, also the low economic group with an income guarantee from 65 years of age. The universality has had a calming effect on the inherent tensions between the wealthy, educated and those with choice, and the large population group with very limited savings potential.

Most OECD countries admire our schemes, the simplicity and universality, with New Zealand Superannuation being different to most others, being taxed at source, but with overall costs significantly lower than most OECD countries.

New Zealand is seen as the smart country in relationship to its Retirement income models, this requires endorsement and reinforcement. No major change is required; when adjustments are required they should be incorporated within the existing model, with no significant change needed.

Means testing is a discredited option, its costs and implementation significant, and advocates never mention the elephant in the room issue, of how the educated camouflage income, using trusts and similar to avoid means testing regimes. If you want to advocate means testing, you must also advocate all trusts and asset protection schemes are dismantled and all income is transparent.

Kaspanz suggests be very wary of single issue commentators and those attempting to forecast the future, the assumptions are frequently invalid, significantly erroneous, and don’t take into account the adjustment all societies make over time.

In simple terms, no alternative to the current NZ Superannuation and Kiwi Saver models has emerged, it’s time we acknowledge the substance of our schemes, and cement them in place for the next 50 years plus.


Kaspanz as the consumer voice, also states that New Zealanders want consistency on retirement income issues, long lead in times for changes, (so financial adjustments can be made and understanding of why adjustments are made, and understood).

Substantial change should be signalled 15-20 years in advance, there is nothing worse than announced changes, occurring within a short time period. The political party that understands these principles and acts accordingly will benefit at the electoral polls.


Kaspanz also is committed to comparative analysis, what is happening world-wide and what implications that has for New Zealand. In a similar manner what is the academic and research saying on trends over time, affecting the key retirement policy issues.

THE FINANCIAL LITERACY COMMISSION should focus on Retirement Income issues. Engage in research both contracted and internal, and should also be the source of authoritative analysis on Retirement Income issues. A hub of research including contacted work on topics is required.

Kaspanz is concerned that the focus on Financial Literacy while having merit in the intention requires too much implementation resource, to have any meaningful affect, and has left the Commission a limp reflection of what it could have been. The twice re branding of the Commission name has been a failure marginalising the Commission into a meaningless entity; New Zealanders have no awareness of the Financial Literacy Commission name or role.

Kaspanz remains concerned that many self-styled commentators on retirement income issues appear to have little historical analysis of the issue at question, or what the current research is saying.

For example while increasing longevity cannot be ignored, it’s “the quality of life “and associated health issues that an individual of senior years is faced with that is of primary importance, rather than the individual might live a couple of years longer each decade. In a similar manner the element of employment opportunity after 60 years is still primarily very limited, and is unlikely to change. Realistic options exist only for the educated and wealthy, the hurdle of perception and bias entrenched into the system compounds the limited options for most, the reality for the majority of the population post 60 years still remains limited work options and declining age, body and mind challenges.

We  notes that  40% plus of current NZ seniors only have New Zealand Superannuation as their income source, and that is  unlikely to change over the generations.!  Note the Australian system with its compulsion, has not affected the number of Australian citizens requiring some sort of Government support or pension! This fact is a baseline issue for any policy changes contemplated


The issue of Annuities often a combination of Insurance and managed funds, requires attention, a Government interested in community well- being should consider its involvement in annuity/ Insurance issues (decumulation).


The issue of fees re Kiwi Saver Funds and similar pension products, in New Zealand has been one of price gouging and outrageous fees, masked by the Industry for years. This state of affairs has gone on for too long, and requires Government attention.


Kaspanz notes there has been no Commission, Task Force or similar on Retirement Income since 1991, such a body would provide a baseline of information and substance for both industry and political decisions.


This submission having made comment on key retirement income issues now makes specific comment on the terms of Reference

Terms of reference for the 2019 retirement income policy review

Aspects of retirement income policies the review must address and the topics to be discussed in the Retirement Commissioner’s 2019 report:

  • An assessment of the effectiveness of current retirement policies for financially vulnerable and low-income groups, and recommendations for any policies that could improve their retirement outcomes.

COMMENT:  The twin Model of NZ Super and Kiwi Saver is a world leader. Its universality and payment to the individual is excellent for women (not dependant on paid work), and universality has a re-assuring affect, reducing the tensions within communities.


  • An update and commentary on the developments and emerging trends in retirement income policy since the 2016 review, both within New Zealand and internationally


The” Golden “age of inheritance is upon us. The transfer of wealth from one generation to another has been a phenomenon over centuries, and the current trend suggests another one has arrived. Research is suggesting grandparents are paying the fees for education, a dominant cost saver for the young with their dominant child caring role, and up there in their house lending mortgage capacity.

One British survey says 1/20 British people receive an inheritance worth more than their ten years of net earnings. NZ mirrors overseas patterns, all the above applies here. The effect of all this upon the retirement income savings of the senior generation is considerable, self-sacrifice for the young can be counterproductive for their own savings!

The Annuities issue requires detailed attention.


“The cost of caring for the sick and elderly will continue to grow, as long as the focus is on adding years to life, instead of adding life and dignity to years’”

Overseas research suggests the issue of living longer (possibly 1.1 -2.75 years longer every 10 years, dependent upon  which research source is used) has camouflaged the real issue that senior years quality of life is significantly impacted and impaired by illness and disease. The issue of improving health is questionable with a lot of research suggesting significant and often chronic ill health, diabetes, stroke, bowel, cancer etc., is not decreasing but increasing. Invalid perceptions in this area abound.

E.g. The Office for National statistics United Kingdom  noted life expectancy is decreasing in the UK, with older people dying at a rate higher than previous trends, and rising  life expectancy stalling An Oxford professor (Danny Dorling} who analyzed the data , said the figures were alarming, suggesting frail people were increasing, Alzheimer’s and austerity measures possibly contributing? Dorling also said people were somewhat blasé about the situation, “5 years ago such data would have got a lot more attention”.

The NZ Listener Feb 2018 reported “We may be living longer, but those extra years are increasingly likely to be marred by ill health.

A study published in Age and Ageing, the journal of the British Geriatrics Society, reports that the number of older people diagnosed with 4 or more diseases will double between 2015 and 2035. A third will be diagnosed with dementia, depression or a cognitive impairment and many also will have severe arthritis

The Australian Bureau of Statistics 2019 has just wound back long term life expectancy projections, rising obesity and associated illness, road accidents and suicides overwhelming advances in medical science.

Professor McDonald Massey University, recent critique of the NZ Health system would be an excellent starting pint:

A blueprint for change

Professor McDonald says there are viable, evidence-informed alternatives for dealing with the country’s future health and healthcare challenges:

  • Stop thinking of health as a set of medical challenges that have social and economic consequences. Instead, approach health (physical, emotional, spiritual, social) as a set of social, economic, political, cultural, and educational challenges (and opportunities), which sometimes produce medical consequences. 
  • Reduce poverty and increase social connectivity and inclusion – because it is good for health and the economy.
  • Stop blaming seniors for rising healthcare costs when the problem is largely caused by an ill-equipped health system being asked to deal with chronic conditions such as diabetes, asthma, and dementia.
  • Put more emphasis on, and funding into, disease prevention at a population and policy level, rather than through acute and primary care.
  • Protect health-enabling measures within international trade agreements.
  • Support healthy ageing by rethinking the design and accessibility of houses, transport, food, education, recreation, and complex care for seniors.
  • Protect dignity and autonomy at end-of-life, including more advanced care planning and hospice care. 
  • Increase public and private sector investment to make New Zealand food the most nutritious and environmentally sustainable in the world – a goal that will improve health as well as long-term exports. 
  • Increase investment and research to track and fight infectious disease through microbiological innovation


The trend is for seniors to work longer in the work place. This leads to senior year’s people contributing to the economy and societal well-being, including paying taxes, all positive engagement. However contrary to the headlines, research does suggest this work force engagement is because of necessity, due to marriage failures, poor investment decisions, caught up in the semi-regular pattern of world economic problems,  and the simple reality of requiring  paid work to maintain reasonable  living standards.

Research indicates most of the population do not have the choice of work, let alone the opportunity, they have to find work to sustain a living income, with hurdles every step of the way. Choice is only available for the privileged (educated)

Those that are educated have significantly more choice in the matter, but most people are working because they have too and not because they want to. Rampant bias against seniors in the workforce exists, compounding the problem for those seeking work.

  • An assessment of the impact that the following will have on government retirement income policies, including Kiwi Saver and New Zealand superannuation:
  1. The changing nature of work, including the increasing number of people who are self-employed and/or working in temporary and flexible jobs;

Nil Comment

  1. Declining rates of home ownership;

Nil comment

  1. Changes in labour market participation of those 65 and older.


The trend is for seniors to work longer in the work place. This leads to senior year’s people contributing to the economy and societal well-being, including paying taxes, all positive engagement. However contrary to the headlines, research does suggest this work force engagement is because of necessity, due to marriage failures, poor investment decisions, caught up in the semi-regular pattern of world economic problems,  and the simple reality of requiring  paid work to maintain reasonable  living standards.

Research indicates most of the population do not have the choice of work, let alone the opportunity, they have to find work to sustain a living income, with hurdles every step of the way. Choice is only available for the privileged (educated)

Those that are educated have significantly more choice in the matter, but most people are working because they have too and not because they want to.

Rampant bias against seniors in the workforce exists, compounding the problem for those seeking work.

  • Information about, and relevant to, the public’s perception and understanding of Kiwi Saver fees, including:
    1. The level and types of fees charged by Kiwi Saver providers; and
    2. The impact that fees may have on Kiwi Saver balances.


Fee’s in New Zealand for the last decade are too high, and have been a golden mile for fund managers. They are well above most OECD countries. The Government should be talking them down, and also consider legislative requirements. Active funds should never be more than 1% and passive fees from 0.5% to.60%. The situation continues to be so bad, a Commission or Task force on this topic is required

  • Information about the public’s perception and understanding of ethical investments in Kiwi Saver, including:
    1. The kinds of investments that New Zealanders may want to see excluded by Kiwi Saver providers; and
    2. The range of Kiwi Saver funds with an ethical investment mandate.

Nil comment

  • An assessment of the impact of current retirement income policies on current and future generations, with due consideration given to the fiscal sustainability of current New Zealand superannuation settings.



The current levels are low compared to other OECD countries. Any reasonable projections show this will continue for many years. The costs re-funding this issue and its benefits mean NZ is in a good state; our twin model schemes (Kiwi Saver and NZ Superannuation) must be available to future generations. Be wary of economic forecasts which take no account of societal adjustments over times, there predicative relevance is minimal.

  • Information about the public’s perception of the purpose and principles of New Zealand superannuation.


Our members believe it is necessary, many see it as an entitlement, and it’s a key component of their retirement income money plans, the safety net for maintaining standard of living and investment decisions. Adjustments to the current model rather than significant change is the message

  • An assessment of decumulation of retirement savings and other assets, including how the Government can ensure New Zealanders make the most of their money in the decumulation phase.



 The emergency of Life Time Income as a provider cannot be emphasised enough. The product is solid and well thought out.  More competition is needed.

 Decumulation is a classic long term issue, which due to that fact seems to be avoided by policy makers.

 New Zealand has a great opportunity to be a world leader in new initiatives in this area and annuities must be addressed. The lump sum received from Kiwi Saver requires addressing e.g. combination of annuity, insurance and a component of the lump sum available for the individual receipt ant could be considered. Using Kiwi Saver Funds to purchase from Government increased Superannuation payment is a useful thought, and the Government Super Fund could be also be a useful vehicle to offer Government annuities, or be converted into such a scheme.

 Alec Waugh