Key's superannuation position must change

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Thu, 31 May 2012 11:17a.m.

"He promised not to increase GST. But he did. He never promised to increase class sizes. But he did. There is plenty of precedent for him going back on his word"

"He promised not to increase GST. But he did. He never promised to increase class sizes. But he did. There is plenty of precedent for him going back on his word"

By Political Editor Duncan Garner

John Key's entrenched position not to touch the age of eligibility for New Zealand superannuation is unsustainable.

He's simply putting off a decision that must be made.

The Prime Minister is under mounting pressure to take a more responsible position.

And New Zealanders, I suspect, would be largely forgiving and accepting if he signalled a change post-2020.

No one is suggesting it needs to change now. But these things need lead time, and they need leadership - Key is offering none of the above on this issue.

He has promised not to change the settings as long as he is Prime Minister, but that surely doesn't mean he can't debate it. He can. And he should.

He promised not to increase GST. But he did. He never promised to increase class sizes. But he did.

There is plenty of precedent for him going back on his word.

The Budget's figures on the future cost of NZ super are alarming - $12.3b in 2016.

That's the same as the entire education budget from early childhood to tertiary for the same year. But that's not really new. Treasury has for years been publishing its long-term fiscal forecasts. They are excellent documents.

The costs of the ageing population dominate the analysis. Treasury has made no secret of the need for change. In many ways they are the lead activists on the issue. Yet Key and his Cabinet continue to bury their heads in the sand - deferring the decision to another Government and another generation.

It's not good enough. It's fiscally reckless and irresponsible.

John Key says it's a decision for "another day."

Wrong.

He says his Government is too busy focussed on growing the economy to have this debate.

Well, I've never met a Government that doesn't say that.

He's right of course - it is his job to create an environment for growth. But so far growth has been limited.

There is simply no real reason why the Government can't do both. It can jump and chew gum at the same time.

So Labour Leader David Shearer has emerged with a plan.

A cross-party group to thrash out superannuation issues. It sounds good on the surface. But how genuine is it?

Labour has not formally written to all the parties inviting them on board. They should have done that.

It appears to be a very good idea without proper intent except to embarrass the Prime Minister and his pledge to resign if the settings are changed.

Except to say this: Shearer yesterday pledged not to politick around the issue if the PM joins up. Big call. But let's take him at his word for now.

For this to work, Key must be on board. The Greens have said yes, ACT would join, the Maori Party want in, Hone Harawira won't say no and Winston Peters could be tempted. Peter Dunne says everyone must join up for this to have credibility. How sensible and how right he is.

Shearer's idea is a good one and it's also an acknowledgement that Labour muffed it at the last election. They sold their idea poorly and didn't give it enough time to breath in the minds of voters.

So he's come back for a second lick, and raised the idea of making super flexible so those in the tough manual jobs get it earlier. They're all ideas with some merit. And the New Zealand public deserves better than how our leaders are treating the issue right now.

Russel Norman says this is an inter-generational issue. He is so very right. Inter-generational issues of this magnitude and cost deserve to be dealt with in a mature grown-up way.

And John Key must now lead that debate. For him to say it's for "another day" lacks any credibility. He leads this country and he knows the age will one day go up like it is in Australia.

If it's good enough for a Labour Government across the ditch to do it - it's good enough for Key here.

He can get around his pledge. He should take the Parliament with him. But this is politics. He won't want to give Shearer any credit. He won't want to share the stage with him.

He shared the stage with Helen Clark over the smacking debate - and Key was seen for the first time as a future Prime Minister. Key won't make the same mistake. Politics will win this debate - not common sense and economics.

So Key will continue to claim Peter Dunne's idea on flexibility is being explored. And it is. But Key needs to pull everyone together for the public good, for the sake of our country and our futures.

National superannuation is not sustainable in its current form.

The experts know it.

The Treasury knows it.

The politicians know it.

The people know it.

It's a fiscal time bomb, that's more than ticking.

John Key needs to make sure it doesn't blow up in all our faces.

He's already addressed some of the unsustainable programmes left by Labour.

And he did the right thing.

Now he must do the right thing by all Kiwis on this one too.

No one wants a nasty surprise in 2025 because of Key's inaction and refusal to signal change now.

Is he up to it?

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Comments

16/08/2012 12:42:23 a.m.

cindy jenkins wrote:

history shows national has destroyed every super system to pay the elderly a decent retirement . they want to deny them any enjoyment in retirement their message to elderly kiwis is die and do it fast so you don't cost . we have to have more tax cuts for the 1%ters they are on the bones of the backsides don't you know .

15/08/2012 10:57:38 p.m.

jan wrote:

I would suggest that Super should stay as is, if the age is put higher those who are between 65 and whatever it may be changed to will no doubt be in line for "unemployment benefit" which would amount to the same thing, most people are not able to work beyond 60 - 65, especially those whose worklife has been in heavy manual type employment.Changing the age bracket will make no difference, in fact it could be worse.

19/06/2012 1:56:08 a.m.

Joronda wrote:

If the Green Party stopped blocking mining, NZ would enjoy a significant increase in export receipts and be able to retain 65 for those who wish to retire at that age. White collar workers should be able to work until 75.

5/06/2012 3:34:45 p.m.

gp wrote:

The process of the police handling students protest held on last Friday proves there is no democracy and justice under current Key's leadership. It is impossible for this government to reduce those high paid officials' salary nore increase the rich people's tax rate.

5/06/2012 2:54:04 p.m.

barney truble wrote:

While it is true that Australia has put up the pension age,its not a universal payment , ie it is assett tested, easily bypassed with family trusts, Nz needs to assett test pensions including trusts, .Also putting up the age may sound good but lets face it , not many trades can work untill your 67, your body just cant handle it . Nz also needs a capital gain tax , its ludicrous that income from farm/ buisness sales is not taxed.

3/06/2012 4:22:33 p.m.

Fellowes wrote:

I have a better idea - introduce Mr Hollande's idea of taxing the rich.

3/06/2012 4:09:39 p.m.

ED wrote:

he has no credibility on anything anymore Duncan . he is no different to Ruth Richardson shiply . its 4 years now not 2008 . you cant pass him of as some one we don't know . also Mr key has changed he is aloof he has not got the smile on as much he is just over all a lot more nasty a personality .

2/06/2012 9:44:43 p.m.

cindy jenkins wrote:

then it will be 70 80 years 85 hell why not 90.and that's is the problem and that's just what they hope for . its like slowly cooking the from from cold water bringing it to boil before the frog realizes hes cooked .and that is the problem with this remember we began at 60 years old already .

2/06/2012 6:16:17 p.m.

cyril wrote:

All the previous goverments of the last forty years must equally share the blame as they have been taking the tax off the baby boomers and spending it knowing this will happen but have been reckless and short sighted hiding there heads in the sand.

2/06/2012 12:28:38 a.m.

Kevin M wrote:

Mr Key,instead of placing everyone under a mushroom,try investing in correct policy as NZF has done,as Democrats have done,as Labour have done.Snap election should be called for or get a real Governer General.