Keep informed on the changes that are happening to superannuation for New Zealanders.
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New Zealand’s current universal superannuation policy was introduced in 1977. Since then there have been many changes to entitlements and we now have ‘65 at 65’. Here is some useful background information and a summary of what to expect in the near future.

What is ‘65 at 65’?

  • ’65 at 65’ is a publicly-funded pension of 65% of the average wage payable from age 65. New Zealand Superannuation operates a ‘pay as you go’ system, whereby Superannuation is paid out of annual tax revenues.

An Aging Population

  • The structure of our population is changing, and our average age is increasing. This aging population is one of the key issues facing us as a nation and has significant implications on the affordability for national superannuation.

2050 Population Projections

  • In 2001, 12% of the population was over 65. This figure is expected to climb to 27% by 2050. Combined with an increase in life expectancies and falling fertility rates, this means there will be a significantly lower ratio of working-aged people to retired people. In government terms - fewer people to fund superannuation from annual tax revenues.

The Government’s Solution

  • Our Government’s response to-date has been three-pronged:
    1. Deferring Eligibility and Reducing Entitlements
      Over time, successive Governments have extended the age of eligibility for NZ Superannuation and have decreased the benefit payable.
    2. The New Zealand Superannuation Fund
      The Government have started saving for our retirement. The New Zealand Superannuation Fund (also known as the ‘Cullen Fund’) was established in 2001, and has a target of $120 billion by 2050 to fund part of the superannuation cost of New Zealand’s aging population. As at 31 May 2007 the fund held $13.3 billion.
    3. KiwiSaver
      The Government has established and will encourage workplace savings through the introduction of KiwiSaver. This is the Government’s voluntary work-based savings scheme. Financial service providers are able to offer KiwiSaver-compliant registered superannuation schemes by meeting specific criteria.

Go to Introducing KiwiSaver >>

For an employer’s perspective on superannuation:

Go to Superannuation in the Workplace >>