Woolerton R Doug: Questions for Oral Answer — Questions to Ministers 
Woolerton R Doug: Questions for Oral Answer — Questions to Ministers 
[Volume:637;Page:7742] 
4.  
R DOUG WOOLERTON (NZ First) 
 to the  
Minister of Finance 
: What if anything is he doing to address New Zealand’s declining level of household savings? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I thank the member for his question. On 1 July this year the KiwiSaver scheme will begin. The scheme makes it easier for New Zealanders to save for their retirement. Earlier this month the UK’s Secretary of State for Work and Pensions John Hutton commented that the British National Pension Savings Scheme has been designed essentially around KiwiSaver. There has also been a range of tax reductions in relation to various forms of savings including the tax reductions on the earnings of people earning below $38000 a year and the abolition obviously of the specified superannuation contribution withholding tax on up to 4 percent of employer contributions to KiwiSaver and KiwiSaver-compliant schemes. 
R Doug Woolerton 
: Has he read recent reports suggesting that public opinion towards compulsory savings may be changing and that 63 percent of respondents to a  
New Zealand Herald  
survey felt that saving for retirement should be compulsory; would he agree that one way of mitigating the effects of compulsion on those of modest means would be corresponding personal tax cuts to offset their initial loss of income? 
Hon Dr MICHAEL CULLEN 
: I think one of the key issues here is that people tend to be in favour of compulsory savings until they are asked who will pay. The assumption of employees is that employers will pay and the assumption of employers is that employees will pay. I had an interesting experience at a recent seminar in Wellington along those lines. I think the biggest problem about requiring compulsory superannuation savings of employees is the fact that then the Government effectively in my view takes on the risk in terms of the success or failure of those schemes. If people arrive close to retirement and their savings scheme falls over—and the Government has forced them to save—what recourse do those people have at that point? 
Hon Bill English 
: Can the Minister confirm or otherwise that under KiwiSaver any person who earns any level of PAYE liable income—as little as $10 a week for instance—will qualify for the full $1000 Government payment on the day he or she enrols in KiwiSaver? 
Hon Dr MICHAEL CULLEN 
: The issue of minima was looked at but it was considered not really worth worrying about that in terms of the likelihood of people actually signing up and the ongoing obligations that they may enter into in that respect. There is always a trade-off between compliance costs and efficiency in those respects. 
Sue Bradford 
: What steps is the Minister taking to ensure that KiwiSaver offers a socially responsible investment option for New Zealand workers and if he is not taking any such steps then what guarantees can he give workers that their savings will not end up being invested in things like tobacco gambling and nuclear weapons as happens with the New Zealand Superannuation Fund? 
Hon Dr MICHAEL CULLEN 
: KiwiSaver schemes are required to meet a set of criteria. If they are not default schemes then the criteria are those for registered superannuation schemes. It is a matter for the House to consider whether it wants to change the entire rules around registered superannuation schemes. I am advised according to the co-leader of the Green Party that at least one socially responsible investment scheme is considering applying for registration. 
R Doug Woolerton 
: Has the Minister read any other recent reports that support the New Zealand First leader’s call for compulsory retirement savings particularly Monday’s  
New Zealand Herald 
—a publication not usually amongst his closest allies—which stated: “He was right then as we were among the few to acknowledge at the time and he is right now.”; and is the current Government totally opposed to revisiting this issue in the future? 
Hon Dr MICHAEL CULLEN 
: I am aware of some considerable support. I am also already old enough now to have lived through a period when there was considerable support for tolling roads in Auckland until we started talking about actually tolling roads in Auckland at which point support for that seemed to disappear. That does tend to lead one to a certain level of scepticism perhaps about public support for things that people have not quite thought through in terms of who is actually paying. 
Sue Bradford 
: Would the Government consider introducing legislation that would provide a clear ethical mandate for all Government investments including those of KiwSaver the New Zealand Superannuation Fund and the Accident Compensation Corporation? 
Hon Dr MICHAEL CULLEN 
: Maryan Street has a member’s bill in the ballot that raises some interesting issues around that. I think it will require quite considerable scrutiny and debate. This is not an easy issue at all—partly because of course it is easy to throw accusations at international corporations that prove to have little substance on further examination and partly because some people for example think Boeing is inherently a bad company because some of what Boeing does involves defence equipment. Given that this country both buys Boeing aircraft and purchases defence equipment it would seem extraordinarily hypocritical to say the New Zealand Superannuation Fund could not invest in Boeing. 
R Doug Woolerton 
: I seek leave to table the excellent editorial from Monday’s  
New Zealand Herald.  
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Peter Brown 
: I raise a point of order Madam Speaker. A few moments ago I took a point of order and referred to a former Minister of Transport who did not know how to spend any extra money if it was granted to him. Apparently I have upset some Labour colleagues. The Minister I was referring to of course was the honourable Minister Maurice Williamson. 
Madam SPEAKER 
: That is not a point of order.