Earlier this year Retirement Commissioner Jane Wrightson said Raising NZ Super age would cause financial misery for over 65s – emphasising far to many commentators look at costs, but not value. Economists always look at dollars, and most are not public policy experts or linked into community needs and expectations. The bean counter is a tool, but far too many bean counters assume other roles and expertise, rarely justified.

To reinforce Janes words,  what did the 2024 NZ Acturies report re NZ Super. Read on and lets hope the various MMP parties and their advisors are reading too!!!!

New Zealand Society of Actuaries, 2024 :Analysis of NZ Super, and an actuarial review of reform.

Overview synopsis

• We conclude that the current structure of NZS fulfils its purpose well.
  NZS is equitable, as it is based on individual entitlement. It does not distinguish by gender, ethnicity, or socio-economic position
  • NZS broadly gives an adequate level of income for current retirees. Its indexation to inflation and link to average earnings provide some future protection. However, there are concerns over the future as more retirees’ mortgages or are renters.
  • NZS is empowering. It encourages people to save for their retirement and enables people to plan for their retirement with confidence because it is not means-tested and currently enjoys a
  level of political consensus around the need for stability in NZS structure. Because of its annuity role, it also makes for simple drawdown plans which can be changed easily as required.
  • NZS is sustainable, under current settings, both in terms of the share it takes of GDP and politically in that New Zealanders widely support it.
  • NZS is simple, understandable, and easily accessed by most retirees.

*We therefore are still of the view that it is not necessary to reform NZS.

Debate usually focuses on the “cost” of NZS, which is often portrayed wrongly as in crisis. Contrary arguments which stress the value and purpose of NZS are strong. No reform to NZS is without difficulties.

• We need to recognise trends which argue against diminishing the role or restricting the value of NZS. Today’s younger people may need NZS more than older generations.

Although younger people can save in KiwiSaver for longer than older people could, they may have less potential to both own a home and save. KiwiSaver balances are not going to be high enough to allow any painless reduction in NZS.

Inequalities in length of life are significant and visible to the extent
that they should be addressed before planning to make them worse