Olive-branch offer over super debate

Last updated 05:00 13/06/2012

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Labour and the Greens have promised not to attack Prime Minister John Key if he agrees to cross-party talks on the pension age.

Mr Key admitted yesterday that National was isolated over the issue but is standing firm, saying lifting the age is "a very simplistic way of looking at a very complex issue".

The debate has raged over the last few days with a series of reports questioning the affordability of the current scheme.

The Paris-based OECD yesterday warned developed countries must make affordable pension schemes a priority – suggesting 67 "is becoming the new 65".

An ANZ bank survey out yesterday revealed people want at least an extra $100 a week above what NZ Super pays out – but about half those of surveyed were not confident they could save enough.

It comes in the same week lobby group Financial Services Council said tax rates will blow out by a third as life expectancy rises.

Treasury says the cost of NZ Super will be 8 per cent of national income by 2050; the FSC predicts it will be 12 per cent by 2080.

Labour leader David Shearer pledged not to criticise Mr Key if he softened his stance.

"The prime minister has boxed himself into a corner. He has closed off options when the public wants to have a proper discussion about it.

"People are concerned about whether superannuation can continue to exist in its current form into the future.

"If he was prepared to say 'I'm going to have a discussion about going from 65 to 67,' I would give an undertaking now that we would not politick on that. We would sit down and have a proper discussion on it."

The Green Party wants to keep the age of entitlement at 65. But co-leader Russel Norman says the party recognises the fiscal challenges.

"We are very much open to multi-party discussion. We think that's the best way to settle it if we can reach a cross-party accord, as has been done in the past. Most government decision-making is driven by politics rather than good policy."

Dr Norman said Mr Key had "painted himself into a political corner and now he's stuck with it. And it's silly".

NZ First leader Winston Peters said his party would be "happy to have a discussion with anybody about sound policies". But he wouldn't commit to refraining from attacking Mr Key.

"I'm not going to give away political strategy."

His party wants the entitlement age to remain at 65. "We believe that far better economic performance is possible from our economy to sustain that."

Mr Shearer admitted that other options, such as compulsory enrolment in KiwiSaver, would also be expensive.

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"We are quite prepared to face up to the issue of cost if it means we are able to keep our superannuation payments going as well as paying for our future generations."

Finance Minister Bill English disagreed with the OECD's conclusions and said New Zealand already had mechanisms in place to deal with the long-term costs of superannuation.

- © Fairfax NZ News

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