Rich Katherine: KiwiSaver Bill — In Committee 
Rich Katherine: KiwiSaver Bill — In Committee 
[Volume:633;Page:4916] 
KATHERINE RICH (National) 
: 
 I thank you Madam Chair as I rise to speak to Part 2. We have heard a lot of members talk about the savings culture and how things have changed over many generations. I have to agree with that because I recall speaking with my own grandparents about their attitudes towards money and saving. Many of the generations before my own generation would never take out loans. And if people did they would do it for something important—certainly not for something flippant like going on a holiday. 
Things have changed and to a certain extent I think there are a number of reasons for that. Banks are always telling us to take out more loans. Credit card companies are always marketing themselves and encouraging people to take out additional credit. Things have changed over a period of time. Even in the schools there has been a small change. Years ago schools used to encourage banking. Kids used to bring along their 20c or 50c a week to put it into their savings account but many schools do not do that any more. I think the changes have chipped away at a culture of saving. I listened to my colleague John Key’s comments about the rise in debt even in the last 6 years. When we hear the figure of $60 billion that is being talked about we feel it is a figure so large that it is hard to imagine that amount in physical bills. So something has been occurring. 
I proffer the view that the Government has played a role in that by giving people the impression they do not need to save because the Government will always be there to let them off the hook if they rack up some debts. Later on today we will be debating the Child Support Amendment Bill (No 4)—legislation that will let liable parents who have child support debts off a pretty hefty amount of child support. Since when has the answer to having a debt been to write it off completely? I do not know. But I think all those decisions made by the Government contribute to the idea that if times are tough the Government will write off people’s debt. There is not the same attitude towards personal responsibility as there was previously. Some younger people think it is OK to rack up a huge debt just so they can travel overseas thinking they will pay it off at a later time. 
I wonder what role this bill will play in terms of changing the culture of New Zealanders. That is my concern. When we look at the bill we see that the scheme is not a compulsory one but an opt-out one so it will be very easy for a young person to decide that he or she wants to have his or her income now. I remember that when I was first a public servant many moons ago now the department I worked for had quite a good superannuation scheme. The Government chipped in $2 for every $1. Well a lot of young people—admittedly we were all in our early 20s—thought they wanted their cash then. They did not want to put it into superannuation savings thinking that retirement was decades away. 
 Even if a scheme with certain advantages is provided it is another thing to try to encourage people to take part in that scheme. That is what I am interested in and I would like the Minister in the chair the Hon Lianne Dalziel to take a call and explain how in an opt-out scheme those people can be encouraged to put in their funding and how it will be explained that even in their early years—in their first employment—it is to their advantage to do so. Unless we do that we will not change the culture in this country and we will continue to have Kiwis who think it is OK to outspend their income on their lifestyle and to take out loans and use credit for luxuries as opposed to important assets like homes etc. 
The other point is that in this bill the Government is promoting homeownership again at a time when the Governor of the Reserve Bank is trying to get Kiwis away from their infatuation with property. I am still concerned about those mixed messages. If this bill is about saving for retirement then that is something quite different from homeownership. I think this scheme runs the risk of muddying the water and not doing a good job of encouraging people to save for their retirement so they can have a better lifestyle in their later life.