New super policies planned

At least three political parties are to announce further superannuation policies over coming weeks in the lead-up to the July 27 election.

Act looks likely to be first off the block. The party's finance spokesman Rodney Hide is expected to formally launch Act’s policy in about 10 days time. That release will confirm its commitment to lifting the entitlement age to 68 and to link payments to inflation rather than the average wage.

However, in something of a departure from Act’s previous approach, some form of specific tax incentive for savings looks set to be included.

National has already announced that it favours incentives, but will release further details by mid-July. Leader Bill English has publicly mused about some form of individualised savings accounts – essentially a refinement of a compulsory saving scheme not a million miles away from that favoured by New Zealand First’s Winston Peters.

The Greens, will, like National and Act, reiterate their opposition to the New Zealand Superannuation Fund but they will seek to extend the current salary sacrifice tax break available for those on $60,000 a year or more to the rest of the population.

Party co-leader Rod Donald said the Greens have a small task force working on the issue, and further policy announcements are likely before polling day.

"The best way to encourage people to save is through employer-subsidised schemes," Donald says. "It remains a private investment rather than a state scheme and you get the leverage of the employer making a contribution."

The remaining parties look likely to just stick to their existing positions.

New Zealand First is expected to continue to press for individualised accounts.

Peter Dunne’s United Future supported the Cullen Fund on the grounds it would provide a longed-for certainty on the issue; but it also wants more action to encourage private savings.

Labour will defend the Cullen Fund, and deputy Prime Minister Jim Anderton earlier this week singled out the fund as one of the significant achievements of the past two and a half years.

Laila Harre’s Alliance looks likely to ignore the issue for now. Harre put out a release yesterday stating the election had truncated the party’s policy development issue, but named 10 key areas the Alliance would focus on. Superannuation was not one of them.