Our View of the Superannuation 2000 Taskforce
Examination of these government appointed members shows the complete lack of any member that subscribes to any view other than the then government line -- where are Len Bayliss and Susan St John who promote an entirely different view ,
- where are the public meetings for input from the public ,
- where are the letters to senior citizens organisations asking for input ?
The Superannuation 2000 Taskforce is unbelievably skewed to
sectional interests that have a vested interest in a scheme other
than a tax payer funded arrangement and contains few if any
members that have the opposite view to the line of the government
that spawned this quango.
As far as we are concerned the taskforce is operating in isolation
without public input to come up with the desired answer.
If the incoming government succumbs to these briefing papers then
we will be totally outraged as it serves the elderly ill that such
extremist views should form a continuance of policy.
The terms of reference of the Superannuation Taskforce are totally
unacceptable and it should be disbanded immediately without adding
to its already extraordinarily high cost of $3 million .
The other side of the sustainability of Superannuation .
Back to indexThe current situation
The previous government announced that while pensions would continue to be adjusted in line with inflation the new floor in relation to the worker's income would drop from 65% to 60% . This was a measure to ensure the sustainability of superannuation and no doubt when the relativity got to 60% it would be reduced to 55% which was the figure that National and Treasury wanted in the initial discussions on the now defunct Accord .There is a complete lack of research and also any desire by the government to date , to undertake such research as to what kind of living standard 65% or even 60% of the average wage actually delivers .
Also Statistics NZ are changing the way it calculates the average wage and the CPI all to the disadvantage of the elderly .
The Grey Peril
We are depicted by the politicians as " grey peril " , an unproductive burden whose growing weight threatens to overwhelm our economy - this is the myth that is used to create the inter-generational antagonism so evident today .This same philosophy is promulgated in the briefing papers to the new government - supposedly these officials are secure in either the elixir of life and will never grow old or are secure in an extraordinarily large public service pension - who knows but they are not in the real world .
The Todd Taskforce
The Todd Task force findings were that there was no need for changes for the next 15 or 20 years as NZS was sustainable .This view, possibly on a different basis , was put forward by an economist in the early 80s when he , Paul van Moeseke , was Head of Economics at Massey University .
He writes as follows
" There has been a great deal of anxious talk about falling birth
rates and ageing population , allegedly entailing a heavier burden
on the employed .
But this fear is entirely groundless .
This is quite the opposite of current popular wisdom .
The young dependents who are far more expensive than the old ,
drop from about 73% to 55% of the total number of dependents .
A change of attitude is needed.
The young are far more numerous , there are far more under-16s than
over-65s , and they are far more expensive than the old . Apart from
the costs of maternity , family benefit , education and the
enormous layout for investment in new capacity , ( the cost of each
new job is from $100,000 to $200,000) , they are responsible for
the lion' share of crime as well as accidents and the attendant
policing and medical costs . So the decline in the fraction of
young people is to be welcomed .
Far from being a worrying trend , an ageing population is a
consummation devoutly to be wished - and subsidising day-nurseries
an allocation stoutly to be resisted " Saving for Retirement
There is another myth that the best way to address the problem is
to convince people to save for their retirement . That may be fine
in theory , but in practice it was a pointless message for many .
Treasury figures show that even if people were forced to save 8% of
their income and given tax cuts to offset the cost - 85% of women
and 40% of men would not be able to save $120,000 , the amount
deemed necessary to provide retirement income around the same level
as today's pension .
There will never be a solution until the spin doctors no longer
propagate viewpoints that are political in nature and actually
address the matter of dependency and sustainability together .Overseas viewpoints
It is significant that the UK which has a much higher dependency
ratio than NZ has just had a Royal commission on Long term Care and
has concluded that for the UK there is no " demographic timebomb "
as far as long term care is concerned . As a result of this , the
costs of care will be affordable .
Perhaps the difference is that in the UK they respect and revere
the elderly and do not regard them as redundant economic units
This contrast dramatically with the briefing papers Dependency ratios .
This device is sometimes used to indicate the burden on the
working population . One of the reasons that the compulsory savings
scheme was not accepted was that it was not clearly proved that the
existing national superannuation scheme is unsustainable .
While we spend 5% of GDP on super in many European countries it
varies from between 10% and 15% .
The elderly dependency ratio is population aged 65 and over as
percentage of working population and the Total dependency ratio is
the population aged 65 and over and those aged 0-14 as a percentage
of working population .
Thus , as you can see, New Zealand does not have a different
problem to other nations . In fact we are better placed than most
so we must hope that all the politicking will disappear and be
replaced by some concerted thinking about how to best solve this
problem .
Elderly Dep. Ratio
Total Dep. Ratio
Year
2000
2030
2000
2030 United States
19.0
36.8
52.0
68.0
Japan
24.3
44.5
47.2
70.5
Germany
23.8
49.2
46.7
75.1
France
23.6
39.1
52.8
67.9
Italy
26.5
48.3
47.8
72.7
United Kingdom
24.4
38.7
54.0
68.0
Canada
18.2
39.0
48.3
69.0
Australia
16.7
33.0
48.0
62.6
The Netherlands
20.8
45.1
47.7
73.2
New Zealand
17.1
30.5
51.9
61.6
Sweden
26.9
39.4
57.9
70.4
Switzerland
23.6
48.6
49.6
77.0
There are a number of options and these must be
explored properly and not be subject to purely political solutions .
The Superannuation 2000 Taskforce
These are the official terms of reference
" The superannuation 2000 Task Force has been established to
develop a stable retirement
income framework that is flexible enough to cope with a changing
environment, and to enable
New Zealanders to plan for their retirement with confidence.
By the time current school leavers retire, the percentage of
New Zealanders over the age 65
will have almost doubled, as will the costs of providing retirement
income and health services.
in order to provide certainty in planning for, and during
retirement, significant changes are
1ikely to be required to taxation, payment levels, or eligibility
criteria.
The Task Force wi1l encourage the development of a widespread
consensus, and report to the
Government in November 2000 with a specific retirement income
strategy . Within the context
of other social services, this strategy should take into account
the age of eligibility level of
public provision, indexation arrangements, integration of public
and private provision,
demographic trends, reasonable economic forecasts, fiscal costs,
information identified by
the reports of the 1991 Task Force on Private Provision for
Retirement, the 1997 Periodic
Reporting Group and any other relevant work.The Superannuation 2000 Task Force will:
Membership - is this representative ?
EXPERT MEMBERS
We rest our case
![[Previous page]](back.gif){kind=small}
![[home page]](home.gif){kind=small}
![[Top of Page]](top.gif){kind=small}
![[next page-thanx page]](next.gif){kind=small}