Saving New Zealand tricky
A ‘softly softly’ approach to encouraging savings emerged from the Saving New Zealand forum in Wellington yesterday.
Thursday, July 24th 2003, 3:12AM
by Rob Hosking
A more specialised body to deal with savings policy is one of the most likely imminent outcomes of the forum. The workplace as a savings environment is also emerging as key.
There is also recognition that middle income earners have to be the main target of any campaign to improve savings. Poorer groups don’t have the money to save (hence the lack of enthusiasm for compulsory savings) and the higher income groups are generally good at making their own arrangements.
The forum heard addresses from Finance Minister Michael Cullen, Irish Pensions Board chief executive Anne Maher, and the chief executive of Australia’s Association of Superannuation Funds Phillipa Smith, and comments from economist Peter Harris relating to his second discussion paper ( Read it here.
The Irish example had a considerable impression on the delegates, with Maher devoting much of her talk to the politics of getting savings reform implemented.
As in New Zealand, the issue generates fierce passions.
"If you can get a consensus on an issue, stick to it until it's clearly not working," she told the forum.
"And get as many parties within the tent as you can because they can give you hell if they there are left outside, and they go on forever."
ISI chairman Simon Swanson emphasised the “big tent” approach taken by the group.
“We’ve been debating these issues for 13 years now, and a lot of it’s been about prescriptions – telling New Zealanders ‘you are going to get this and this and this but not that’.” The group is trying to take a less ‘lay down the law’ approach.
There is also the recognition – somewhat grudging – that tax incentives are irrevocably the government’s agenda. That was despite the Irish example, which included some incentives.
Rather, there is likely to be a renewed push to remove the disincentives to saving, about which there has been much rhetoric but precious little action.
"There’s no argument about the big picture – New Zealanders have become more in debt and will have to save more,” Swanson says. “But there’s plenty of argument about the details.”
Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.
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