Nest-egg laying KiwiSaver to have its wings clipped
Both Key and Finance Minister Bill English have said changes are to be announced for the scheme as the Government attempts to rein in the budget deficit, with media speculation suggesting the Government may cut the member tax credit or abolish the $1,000 kickstart payment.
For Hassan, whatever form the changes take, they will invariably damage the scheme's effectiveness as a long term savings vehicle.
"You can't take away a subsidy and have people behave the same way, so no matter what they do to change the subsidy it'll have some negative effect on savings. It's a question of how significant it is or how widespread."
He said changes to incentives would also disproportionately effect younger savers - the people the Government wants to encourage to save more - as older savers and those already enrolled have received the benefits of subsidies like the kickstart.
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