Income lift for thousands of GSF superannuitants

Thousands of Government Superannuation Fund recipients will have their incomes lifted as a result of proposed amendments to the GSF scheme, Finance Minister Michael Cullen said today.

Funding of $3.3 million in 2006-07, $3.5 million in 2007-08 and $3.4 million in 2008-09 and out years would be allocated in the coming budget to support the proposals which had been sought by the Government Superannuitants’ Association and the New Zealand Railway Superannuitants’ Association.

“The decisions are consistent with the government’s strong record on promoting security in retirement.

“Other initiatives in this area include the repeal of the previous National government’s cuts to the public pension, the establishment of the New Zealand Superannuation Fund and – more recently – the creation of the State Sector Retirement Savings Scheme.

“Budget 2005 will continue this focus with the introduction of a work based savings scheme for the private sector workforce and with tax changes to make saving through a managed fund more attractive,” Dr Cullen said.

The planned changes to the GSF are: An undertaking that all GSF annuitants will receive inflation adjustments to their pensions of at least 90 per cent. [This will benefit 15,774 people.] Provision to make permanent arrangements protecting the surviving spouses of GSF annuitants against income loss as a consequence of the 1990 changes to the tax treatment of superannuation schemes. [This will protect 2,692 people immediately and a further 17,879 potentially.]

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