Super fund now a reality

The passage of the New Zealand Superannuation Bill marks a big day for the Parliament, the Government and the country, finance minister Michael Cullen said.

"It is one of the most significant policies enacted in New Zealand for several years.

"For me personally, it represents the culmination of 14 years as Labour spokesperson on superannuation. I would like to put on record my thanks to my government colleagues, to New Zealand First and to United MP Peter Dunne for their support in getting the legislation through.

"All parties in the house except Act voted for Part I of the bill, cementing in the existing '65 from 65' formula of entitlements. That will provide a lot more certainty for New Zealanders at or near retirement," Cullen said.

"But genuine security, especially for those now in their early 50s and younger, depends upon having a broad consensus on the mechanism to pay for those commitments in the longer term.

"I hope that National, the Greens and Act will reconsider their decision and sign up to Part II of the bill setting out the structure and governance arrangements for the New Zealand Superannuation Fund.

"The bill provides a facility for them to do this at any time."

Work would now begin on appointing a nominating committee of people with savings industry and financial expertise to draw up a short list of 'suitably qualified' candidates for the Board of Guardians.

'Suitably qualified' was defined in the bill as having substantial experience, training and expertise in the management of financial investments.

"The responsibility for recommending appointments to the Governor General falls to me as Finance Minister. But the bill requires me to first consult with the other political parties in the house. I would expect the board selection process to be finalised before the end of December.

"The government set aside $600 million in this year's Budget as a first instalment into the Fund. That money has been sitting in a bank account in the Debt Management Office of the Treasury since July 1 and will be transferred over once the board has appointed a secretariat, set the investment strategy for the fund and engaged the fund managers. I would expect all that to be in place by mid next year," Dr Cullen said.

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