Finance Minister Nicola Willis has
not ruled out ending Government KiwiSaver subsidies
ahead this year’s Budget.
“Willis’ Government
was elected to make hard decisions—ending Government
funded KiwiSaver subsidies is exactly one of them” said
Sam Warren, a spokesman for the Taxpayers’
Union.
“Make no mistake, the subsidies costs
taxpayers hundreds of millions each year, diverting
desperately needed funds from other services or urgently
needed debt repayments.”
“A product of the Fifth
Labour Government back in 2007, the subsidies hoped to
encourage KiwiSaver participation and contributions—but
with that comes its own
problems.”
“Now that membership
levels are near-universal, the subsidies themselves are
redundant. They also distort behaviour as individuals with
investments and savings elsewhere will opt for lump
contributions annually to receive the $521 payment by
government.”
“The programme also
operates as a private savings scheme, making the subsidy a
wealth transfer from taxpayers to savers.”
“Most
will agree that propping up private savings is completely
inefficient—the government should straight out prioritise
tax relive and allow individuals to save
independently.”
“Times are incredibly tough, and the
books are in dire straights. It’s a hard decision, but it’s
the right one to get the economy back in
shape.”
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