CTU Media Release

9 October 2013

Unions Respond to Review of Retirement Income

Unions have responded today to the release of the draft Review of Retirement Income Policy.

Peter Conway, CTU Secretary, says that “it is in all of our interests to ensure that we have a sustainable policy to support decent retirement incomes”.

“The recommendations that lift the age of entitlement to NZ Superannuation over a long period and change the indexation method will raise concerns among workers about the adequacy of retirement income even though measures have been included to address those most adversely affected”, said Peter Conway.

“The proposal to dilute the indexation to the average wage runs a severe risk of reducing the value of NZ Super payments over time”.

“However”, he said, “unions will support the recommendations that the Government take on KiwiSaver contributions for workers on paid parental leave and that proposals are developed with unions and employers to support older workers”.

The CTU supports maintaining NZ Super in the current format, lifting the top tax rate to generate additional income, and boosting the level of employer contributions to KiwiSaver to 6 percent phased in over 3 years.

Peter Conway said that there is mounting concern that the combined effect of low wages, insecure work, falling levels of home ownership, and high levels of personal debt will make it very difficult for people to save and plan for a reasonable standard of living in retirement.

ENDS

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