Nats and Labour hold fast on pension age

Wednesday 8th December 2010 1 Comment

National and Labour are ruling out raising the pension age despite a report from the Retirement Commission which warns that to keep National Superannuation affordable it should increase to 67 by 2033.

Retirement Commissioner Diana Crossan said yesterday superannuation would cost nearly 8% of GDP when the bulk of the baby boomers reitired.

At present it costs about 4% of GDP.

"We can't keep ignoring this issue until it's too late," she said.

The commission's recommendation is that the age of eligibility should rise by two months a year from 2020, reaching 67 in 2033.

Prime Minister John Key said he believed the pension was sustainable at the current age of 65.

"We're going to continue to pay New Zealand Super at 66% of the average wage for New Zealanders who are 65 and above," he said.

Labour leader Phil Goff said his party wasn't prepared to increase the age or reduce the payment.

He said Labour would restore pre-funding of the National Superannuation Fund and further develop KiwiSaver.

"It's important to work now to offset the costs so the burden isn't simply postponed for future generations to deal with," he said.

"While the Retirement Commission's proposals are not necessarily the right proposals as far as Labour is concerned, it is important that we are able to have a full and frank debate about the issue."

He invited the Government to provide all the information it had and look at the issue on a cross-party basis.

NZPA

Comments from our readers

On 9 December 2010 at 4:51 pm Harold said:

Both parties are guilty of short sighted populist mentalities. But the voters who think they can have a free ride will get what they deserve.