Easier saving one step closer – KiwiSaver default providers signed up

Monday, April 2nd 2007, 3:34PM

The six companies selected as KiwiSaver default providers were officially signed up for the job at Parliament today by Finance Minister Michael Cullen and Commerce Minister Lianne Dalziel.

"Today's signing underlines the excellent progress we are making to ensure KiwiSaver takes off as planned on 1 July," said Dr Cullen.

"KiwiSaver, the new way to save at work, makes the job of saving for your retirement easier because saving starts when you start working.

"People who join KiwiSaver without choosing a preferred savings scheme will be automatically allocated to one of the selected default providers.

"The default providers are an important part of KiwiSaver as they help people who want to save, but who find it difficult to start. The default providers help them maintain savings momentum while leaving their choices open for the future."

Commerce Minister Lianne Dalziel said the six default providers were selected in a competitive tender process and underwent a detailed evaluation to ensure they met a number of stringent criteria including their: security and organisational credibility; organisational capability; proposed scheme design; administration capability; competitive fee levels; and investment capacity and capability.

"We wanted to make sure KiwiSavers who are allocated to one of the default providers will be looked after by a fund manager of the highest quality. This is important to maintain the confidence of employees in KiwiSaver."

Dr Cullen said the risk profile for the default investment product was conservative and offered a lower degree of risk, while providing moderate returns over the longer term.

"We felt this was right for people who did not feel confident about choosing their savings products. However, the default providers, as well as other firms who will also offer KiwiSaver products, will offer a range of investment options which members can switch to at any time if they feel it would suit them better," Dr Cullen said.

"KiwiSaver shows the Labour-led government dealing with a key challenge. We have a savings problem. The Reserve Bank estimates that for every $1 an average household earns, it currently spends around $1.15.

"We are rising to the challenge by making it easy for people to increase their level of savings and build the assets they need to secure their futures."

The six providers selected will be ready to accept members when the scheme comes into operation on July 1, 2007. They are:

ASB Group Investments Limited
AMP Services (NZ) Limited
ING (NZ) Limited
Mercer Human Resource Consulting Limited
National Mutual Corporate Superannuation Services Limited (trading as AXA New Zealand) and
TOWER Employee Benefits Limited.

« AXA confirmed as default KiwiSaver provider

KiwiSaver default scheme providers announced »

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