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Key in the dark over superannuation review

Published: 6:11PM Thursday October 18, 2012 Source: ONE News

John Key might think New Zealand can afford national superannuation the way it is, but others within his Cabinet seem to be questioning that stance.

The Prime Minister's view on the affordability of national super has always been crystal clear: "To us a growing economy can cope with the issues of bigger pension costs."

But despite Key's confidence, a growing number of economists feel that with an ageing population, national super is not sustainable as it is.

And now one of Key's own ministers wants the issue formally looked at by Retirement Commissioner Diana Crossan.

Key appeared surprised when ONE News asked him what he thought about Commerce Minister Craig Foss giving the Retirement Commissioner the go-ahead to look at the issue.

"Well they are required to review every few years and they nominate topics and I agreed to them," Foss told ONE News.

But in the 2010 review there was no requirement from Government for the Retirement Commission to look into super's sustainability.

In a letter to the Retirement Commissioner, Foss sets out the topics the Government "requires to be addressed in the 2013 review", including the effects of people living longer on savings schemes, and the sustainability of national super.

Key told ONE News he does not know why Foss has asked that.

"It's also true that Treasury does a lot of work, but my view is that it is affordable and sustainable."

Labour MP David Parker hit back, saying: "Once again John Key doesn't know what's going on in his Government."

The Retirement Commissioner - who could not be reached for comment - will deliver her report in December next year.

But unlike her review two years ago, this time round she has a mandate to look at an aspect of national superannuation.

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