Rich Katherine: KiwiSaver Bill — In Committee 
Rich Katherine: KiwiSaver Bill — In Committee 
[Volume:633;Page:4954] 
KATHERINE RICH (National) 
: 
 I always think it is pretty interesting when Labour MPs have a chip at John Key. It seems to me a defining difference between the two parties because the truth is that we in National want people in State houses to grow up to be successful and to do well. That side of the House wants people who live in State houses to stay there and to be poor for their whole lives. That Minister in the chair Michael Cullen does not like people being rich and he does not like poor people becoming rich so as a result we can only conclude that he likes poor people to stay poor. Although members on the Government side of the House chip away and talk about ornaments and houses it is really nothing more than envy and a reflection of their views of where they want the people who vote for them to stay. 
I feel sorry for the Finance and Expenditure Committee members who have looked over this bill because they have worked hard. They looked at this bill heard submissions and had members of the public come in and consult on this bill. They reached their conclusions and decided that mortgage diversion would play no part in this bill. And then—hello!—2 weeks later the bill was dramatically changed to the point that Labour members of the select committee have felt unable to take a call because in fact they were unable to recognise parts of the bill. I wonder what that says about parliamentary process. What is the point of select committees working hard on something to nut out the pitfalls and to hear the views of the public if that work is to be ignored and the bill comes back to the House where the Government will change it anyway?  
 If members look at the insertion of a mortgage diversion aspect to this they will see that it could in fact undermine the validity of the whole scheme because the whole point of the scheme was to be a savings scheme. By introducing the ability for people to take out large amounts of their money the Government has made the scheme nothing more than a cheque account. In terms of the ability to withdraw money people need be in the scheme only 5 years. If someone in his or her 20s goes into the scheme that person can withdraw most of the money by the time he or she is 25. So much for this being a scheme to help people in their retirement—some 40 years earlier people are being allowed to take the money out and put it into something else. That is not saving for retirement. That is not teaching people about saving at all; it is just saying to people that money will be put into a cheque account and they can take it out for a special project. 
The other thing is that the bill assumes people will get into their first homes and stay in them. Well a lot of young homeowners go into that first home and move on to something else within the first couple of years. I do not think that owning one’s own home is the main thing that a person should do for his or her superannuation. Certainly it is part of what Kiwis do but this country does have a fascination with property. Retiring and putting something aside for one’s future is buying a rental property; it is not putting money aside into other sorts of superannuation as other countries do. 
The main thing the Government has done by introducing mortgage diversion and having all sorts of other abilities for people to withdraw funds is to increase the transaction costs of running the scheme. All the default providers are pretending to be excited but behind the scenes they are very concerned about their ability to provide a service and make any money out of it. Some of them are banking on compulsion being introduced at a later date but that is not the reason they are interested in it; they do not want to be left behind. But if the number of transactions introduced to this scheme increases dramatically that increases default providers’ ability to provide a scheme for Kiwis. 
So I feel sorry for small-business owners. It will be very hard to work out contributions. I feel sorry for the small-business people who will have to sit down and work out a contribution that might be different every week. Then they will have to work out deductions for student loans child support payments PAYE GST—it is no wonder that small-business people out there are saying that it is getting harder to do business in this country not easier. This will add to the complexity. 
Hon Trevor Mallard 
: I don’t believe that this member is as silly as that. 
KATHERINE RICH 
: There is the Minister of Finance in waiting. He thinks it will be easy. That man has never run a business; he would not have the first idea of what the pressures are in running a business.