



SUPPLIED Superannuation reform puts politicians "between a rock and a hard place" because people are so divided on what they want to see happen.

Policy makers are "between a rock and a hard place" when it comes to New Zealand Superannuation reform, a new report has found.

The New Zealand Institute of Economic Research's latest paper, Population Ageing - Do we understand and accept the challenge? investigated Australian and Kiwi attitudes towards the future of retirement policy.

The reforms that the report looked at included raising the age people start receiving superannuation payments, paying less to those with more assets or income, and reducing superannuation payments.

It found retired Kiwis were the most in favour of raising the age and increasing taxes, but the least in favour of tailoring payments to peoples' means.

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Surprisingly, the support for raising the age or lowering the amount paid to retirees was lowest among 25 to 54 year olds, even though those older would benefit at their expense.

Means testing, which would mean access to payments was restricted to those who don't need assistance, was "not met with much enthusiasm", the report concluded.

KARL HILZINGER/AFR Setting people's superannuation payments based off how well-off they are is especially unpopular among those over 65.

But even those in favour of means testing were strongly against including the value of the family home in an assessment.

The report was commissioned by Chartered Accountants Australia New Zealand.

Australia is raising the eligibility for a government-funded pension to 67, with a planned further increase to 70. The United Kingdom government has also committed to raising the age of state pension eligibility to 66 by October 2020 and to 67 between 2026 and 2028.

But in New Zealand, the Labour Government has pledged to retain age 65 as the eligible age superannuation.

This commitment is projected to raise the pension cost to GDP ratio by 60 per cent over the next 40 years, while in Australia the same cost is projected to rise 25 per cent.

Superannuation costs an estimated $30 million a day, and is expected to rise to $288m by 2050, the retirement commissioner Diane Maxwell said last year.

STUFF The NZ Super fund is expected to cost $288m a day by 2050.

Three-quarters of Kiwi respondents in NZIER's survey recognised superannuation was getting more expensive, but they tended to underestimate the extent to which superannuation would increase in cost.

The report zeroed in on how politically acceptable the different "fixes" would be. But no one option seemed to lead the pack. The most popular option across all age groups was no immediate or future change, even if it was phased in over 10 to 20 years.

Chartered Accountants superannuation leader Tony Negline said the report showed politicians "were between a rock and a hard place" with no strong support for any one option for reform.

SUPPLIED Chartered Accountants' ANZ superannuation leader Tony Negline says the report shows people are divided on how to improve the retirement system.

"New Zealanders are resistant to change, including the prospect of increasing taxes to fund the inevitable increase in costs.

He said the report showed the public's dominant preference was for the status quo to remain in place and that the government pension should be provided universally, without a means test.

The report said "more compelling evidence" was needed to show what the costs of non-reform was.