5 Sep 2017

ANZ backs compulsory KiwiSaver

2:35 pm on 5 September 2017

KiwiSaver should be compulsory or incentives should be reintroduced to attract people to save for their retirement, ANZ says.

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Photo: 123RF

ANZ managing director of wealth Craig Mulholland said 2.7 million people had joined KiwiSaver since its launch 10 years ago, but 375,000 working-age people have not enrolled.

"As people's life expectancy increases, and with a greater proportion of the population going to be 65 and over ... the whole of New Zealand is going to have to fund retirement.

"The more we can do now to increase our savings the more important it will be."

The bank's view is supported by a UMR survey of 1000 people, carried out last month, which found 60 percent of respondents agreed with making KiwiSaver compulsory - although 30 percent opposed the idea.

The greatest support for compulsory membership was from people whose household income was $100,000 or more while those earning half that were much less likely to back forcing workers to be members.

"The research does raise questions about whether KiwiSaver is reaching the people who most need it," Mr Mulholland said.

If membership was not made compulsory, he said, the government should reintroduce an incentive to encourage people to join up, or automatically enrol new workers and give them the right to opt out.

The government scrapped the $1000 join up payment in 2015, but members still receive a tax credit of $521 if they save at least $1043 a year.

The ANZ is the country's biggest bank and offers a KiwiSaver default scheme.

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