4 Aug 2011

Compulsory KiwiSaver 'inevitable'

8:55 am on 4 August 2011

A major superannuation provider says it is inevitable that KiwiSaver will become compulsory.

Prime Minister John Key said on Wednesday the Treasury is looking at how to increase the scheme's membership, for example by automatically enrolling all workers, rather than signing people up only when they get a new job.

Mr Key also says KiwiSaver accounts could be offered shares in the state-owned energy enterprises that are likely to be partially sold off.

Tower Investments chief executive Sam Stubbs told Morning Report he believes the business community would back a compulsory scheme, as it would mean a large pool of money for investment.

However, more important than whether a scheme is compulsory, he says, is that changes such as those proposed will encourage people to save for their retirement.

"Habitual savings is what has been very beneficial to countries like Sweden, Denmark, Switzerland (and) Singapore," he says.

Mr Stubbs says most people earning a wage would agree they should be saving for the future.