Woolerton R Doug: KiwiSaver Bill — Second Reading 
Woolerton R Doug: KiwiSaver Bill — Second Reading 
[Volume:633;Page:4853] 
R DOUG WOOLERTON (NZ First) 
: 
 New Zealand First supports the KiwiSaver Bill. We support it because we have always supported incentives to save. In the past we have supported compulsory superannuation and we supported superannuation as proposed by Dr Cullen a few years ago—which I might add is proving to be very successful. 
It saddens me a little that the National members of the Finance and Expenditure Committee are speaking—at this point anyway although that may change later—as fairly practised experienced financial operators which they are. They have a deep understanding of matters financial but they are not the people this bill is aimed at. The reason New Zealand First supports the bill so strongly is that it aims to encourage a savings mentality in this country. Unfortunately we have lost a savings mentality since the days of what we like to call the right-wing economic changes during the 1980s. The experiments of those days have shown that the Government should give messages give encouragement and where possible give education or enlightenment on financial matters. 
It is all very well for Mr Craig Foss. I acknowledge his expertise in this area. I acknowledge the expertise of John Key in this area and with due respect that of Mr Tremain and Dr Lockwood Smith. But that is not the way that most New Zealanders understand finance. Those members understand finance in a way that most New Zealanders do not. In our view this measure is an honest attempt to go some way to get people started on the ladder of financial independence not only through direct financial savings but now through a mortgage scheme. I am sure that my colleague Gordon Copeland will be spending a lot of his time explaining that scheme because it is a particular hobby of his. So even though professional financial managers may pour scorn on this bill New Zealand First sees its value to get people with rather less financial literacy involved in saving. 
 We also congratulate the Government—even though the news has just come out today—on introducing some sort of financial incentive in the form of a tax-free employer contribution. We think that more of that sort of thing should be done. It has been very much out of favour in recent years but it is now coming back into favour. We think that is a marvellous thing. 
I think this bill will succeed in the community. The National Party members are correct—there is a tight financial market out there. It is tough for people on lower incomes and that is why the employer contribution is so vitally important in this scheme. People simply have not been saving by their own initiative. So this Government has accepted what I believe is the responsibility of a Government and has said it must lead the way. New Zealand First says hallelujah to that. 
There was discussion in the select committee about the rate of contributions and members heard that discussed by previous speakers. There are arguments for making the contributions very low in order to help those who may find it very very difficult to put in anything at all. Others say the financial institutions would not want to be involved at that low level. Members heard that discussion earlier. People said we should have contributions as high as 4 percent on both sides of the employer-employee scale. I think personally that the balance is about right but that can be seen and tested in future years. As Dr Cullen said in his introductory speech there is the ability for people to change this scheme. There is the ability to make it compulsory if that is what is decided in the future. There is the ability to enhance the scheme in other ways as Governments of the day see fit and as people make demands upon those Governments and search for ways to look after themselves. 
When we are talking about the default providers I think it is important to understand that there was some criticism about the process as Mr Foss read out from the commentary. The Government had to move ahead with those default providers and talk to them and they had to bid for the business—to use my term which is not the correct term—before this bill was presented to the House. I must say that I shared some of those concerns as well. I was happy in the main that the National Party put in that rider in the commentary in relation to those provisions. It is quite clear in our view that those businesses that have been established in New Zealand for many years and that have a household name will have some advantage for capturing and growing the business. The select committee made its best endeavours to search for a way to even the playing field in order to get in newer more entrepreneurial providers. I suggest that may not have happened but we will see who the providers are at the end of the day. I suspect they may be the traditional ones. 
I do not want to take up any more of the time of this House. I just wanted to say that New Zealand First is not just a supporter of this bill but an enthusiastic supporter of this bill. People will opt out of the scheme from time to time. I do not think we should be afraid of that. I think it is something that will take many years to become accepted as part of the New Zealand psyche but I give my congratulations on a great start.