ORC seeks to review its funding arrangements
A 60 per cent decline in private sector funding of the Office of the Retirement Commissioner (ORC) and a change of Government is forcing a review of the office's operations.an
Thursday, January 20th 2000, 12:00AM
Originally, when the ORC was established five years ago, then finance minister Bill Birch strong-armed 10 firms in the financial services firms to contribute $100,000 each annually to help fund the office.
Many of the original sponsors have withdrawn their financial support as they want to use their money in other ways. Also there is a strong feeling that the work of the ORC has turned the tap on and got people to start saving (or thinking about it), and now they want to put their bucket under the tap and capture some of the new business.
The ORC says in its annual report that the method and level of funding needs to be reviewed.
While it doesn't spell out any options, two possibilities include making the office fully Government funded, or introducing some sort of levy system on firms in the savings industry.
Despite private sector funding falling from $1 million annually to $400,000 the ORC is still running a full program of events with the $3.7 million it receives from Government, including further television campaigns, a workplace education scheme and the financial literacy program in secondary schools.
In the report commissioner Colin Blair says that the changing political environment also is forcing a rethink of operations and the ORC's role.
"With the progressive demise of the Accord and the return of retirement income policy to the political arena, it is appropriate that the Office's relationship with political parties and in the area of policy comment and development be reviewed.
Currently, the ORC is charged with giving its minister advice on retirement income issues, but only when requested. However, under the previous government that request was rarely made.
Again the ORC hasn't spelt out options, but some which are likely to be considered include making the Retirement Commissioner an officer of Parliament, or giving the office a formal role in policy development.
The four sponsors still supporting the ORC are Tower, BNZ, NZ Stock Exchange and Royal & SunAlliance.
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