Worst political ambush in 20 years

15 August 2007

Worst political ambush in 20 years

Landing employers with compulsory KiwiSaver contributions on Budget day was the worst political ambush seen in 20 years, Business NZ chief executive Phil O’Reilly said today.

Speaking to the select committee considering the Taxation (Annual Rates, Business Taxation, KiwiSaver &Remedial Matters) Bill, Mr O’Reilly said the move totally overturned the ‘no compulsion, no surprises’ understanding between employers and the Government.

“Before Budget day there had been a significant period of consultation during which it was understood that the Government would make best efforts for the scheme to be ‘compliance-light’, and that no compulsion would be applied to employers. Employers in return were prepared to engage positively and support the moves towards a workplace-based scheme.

“On Budget day, without warning, this all changed. There was an ambush, and employers were suddenly the patsies, lumbered with compulsory monetary contributions as well as the compliance and risk of administering the scheme.

“Clearly, ambush trumps consensus. Dr Cullen is still calling for consensus around retirement issues but it is obvious that the consensus no longer includes employers.

“It makes it even more important that this select committee takes account of submissions to this Bill, since there has been no opportunity for discussion with business on the KiwiSaver scheme as it now is. There are real problems with the scheme - not least its vulnerability to industrial activism - and the need to retrofit consultation should be addressed by this select committee.”

ENDS

© Scoop Media