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The Government announced a new superannuation policy, raising the age of entitlement to 67 by 2040. The new policy would be gradually implemented from 2037.
The current policy allows those who are 65 and above to claim fortnightly superannuation payments, which come from the Superannuation Fund.
Between 22–23% of the country’s population will be older than 65 by 2040, according to Statistics New Zealand.
The government has predicted that an increase of the retirement age to 67 would reduce superannuation costs as a percentage of GDP from 7.2% to 6.6% in 2045.
Government contributions to the Superannuation Fund were frozen in 2009, and National intend to restart contributions to this fund in 2020. Opposition parties argue they should never have been frozen in the first place.
The Minister of Finance, Steven Joyce, cited the longer life spans of citizens as motivation for adjusting the superannuation scheme.
Despite this, Labour leader Andrew Little said “bodies still wear out at the same rate,” and that an elevated eligibility age would be unfairly detrimental to workers in physically taxing jobs.
Salient requested comment from Joyce as to why the Government was insistent on investment as a welfare strategy while simultaneously neglecting contributions to the Superannuation Fund.
He did not respond before this article went to print.
In a press release, Joyce said the proposal’s timeframe “will give future generations of New Zealanders more choice as to how they allocate their government spending.”