Superannuation
- What is it about National Governments and their inability to make decisions
in the interests of the country when it comes to the basic issue of
superannuation?
Prime
Minister John Key has painted himself into a corner over his claim that the age
of eligibility for superannuation, 65 years, will not change on his watch.
It is
patently obvious that superior lifestyle has resulted in people living longer.
In many instances that means people are capable of working longer. Of course,
there are exceptions and there are people to whom working beyond 60 years is an
issue.
But,
generally, New Zealanders can expect that the majority of the population will
be capable of working longer in the future – in many cases they will have to
because the drain of young people offshore looking for work, a drain that the
said Mr Key was going to stop when he was campaigning against Helen Clark and
Labour in 2008, has reached epidemic proportions
It remains a
frustration for this observer that in the leadership debates of that campaign
the incumbent Clark did not challenge Key when he was blathering on about
stopping the brain drain. All she had to do to end the argument was ask where
Key had earned the money that allowed him to have the lifestyle he enjoyed? It
certainly wasn't from years spent working his way up from the back benches in
New Zealand.
But then
again the fight was no longer in Clark – she had had enough it would seem.
However, it
seems that in sticking to his claim over the eligibility age that Key is
determined to avoid the back flip that George Bush the first suffered over his
pre-election campaigning on 'No More Taxes'. A promise that was very quickly
undone once he replaced Ronald Reagan in the White House.
Back in New
Zealand the age of eligibility has become an issue for which the public may
well be prepared to punish the government, which is plugging austerity in all
other areas of the economy.
Let's not
forget that it was Robert Muldoon who showed a flagrant disregard for the
future by throwing out the compulsory superannuation scheme set up by Roger
Douglas in the Kirk-Rowling Government of 1972-75.
Dancing
Cossacks flashed across television screens, catching the eye of those nearing
their retirement sufficiently to put Muldoon in power with his promise that he
would close the scheme down and install a scheme that would mean once reaching
the age of 60 people would be able to receive National's superannuation, even
if they were still working! Let's not forget that – they were still able to
receive the payout if they were still working.
It is little
wonder that generation were known as 'The Greedies'.
In making
that choice Muldoon sent New Zealand into permanent debt. There are two
thoughts here: how much of the country's financial frustrations of the moment
are a direct result of that decision and, more importantly, how much better off
might New Zealand be had he not made that choice?
Muldoon
trumpeted that the New Zealand Superannuation Scheme was going to result in the
nationalisation of New Zealand's industries. It was going to be communism by
stealth. The Greedies were sucked in lock, stock and Think Big.
In fact, and
to their shame the Labour Government of the day did not make this point
sufficiently, it was enshrined in law that the NZ Super Scheme would not be
allowed to invest any more than 15 percent in any New Zealand company. 15
percent!!
That figure
is important because Key and his Cabinet are asking that the New Zealand
Superannuation Fund set up by Labour's Michael Cullen should invest up to 40
percent in New Zealand companies.
What would
Muldoon make of that? If what he canned in 1975 was communism by stealth what
does 40 percent investment represent?
Just as
Muldoon's failure hamstrung a generation, so Key's foot-dragging is likely to
do for the generations who follow those who move into retirement over the next
20-odd years.
It is only
commonsense that a phased rise in the eligibility age be introduced as soon as
possible.
So
poll-driven has the Government become that there is a chance that Key will see
the error of his ways and make a decision forthwith.
His highly
unpopular austerity measures continue in other aspects so it defies belief that
the one popular measure he could implement, and with exceptions for those whose
work might qualify for a maintaining of retirement at 65, could elude him.
Failure to
act leaves him facing the same sort of legacy his predecessor Muldoon enjoys
for his greed for power at any cost.
