Lifting the age of eligibility for superannuation to 67 could
result in savings of at least $100 billion by 2061,
consulting and investment services company Mercer says.
The double whammy of an ageing population and global
financial crisis had highlighted the need for the Government
to address the adequacy of retirement savings, and reduce
reliance on NZ Super, Mercer says.
Lifting the eligibility age to 67, and removing disincentives
to encourage the take-up of annuity products were solutions
that could potentially address the problem.
In a report, Securing Retirement Incomes - Time to Act,
Mercer included raising the age of eligibility as a
recommended option, with an alternative being fixing the NZ
Super age of entitlement as a percentage of life expectancy.
Prime Minister John Key has said he would resign as a member
of Parliament if the age of eligibility for superannuation
did not stay at 65.
Mercer also suggested means testing for NZ Super, and the
creation of an annuity products market.
Mercer also suggested fairness could be improved by allowing
people to defer the receipt of NZ Super and remain in the
workforce, then receive a one-off increased payment later on.
It proposed measures to protect small KiwiSaver accounts, to
encourage savings to be transferred to KiwiSaver, and
encourage salary sacrificing into KiwiSaver by lowering
front-end taxes on employee contributions.
Other suggestions relating to KiwiSaver included the
introduction of greater incentives for higher employer
contributions, and possibly introducing compulsory savings
for higher income earners.
"It's time for the Government to take some decisive action
and balance the politics in the current debate with what's
ultimately best for New Zealand . . ." Mercer New Zealand
head Martin Lewington said.
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