Labour pushes retirement age hike
Should the age of eligibility for NZ Super rise in line with life expectancy?
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Labour says raising the retirement age would not necessarily be the election deal-breaker the Government was making it out to be.
Finance spokesman David Parker said today that unless there were massive tax increases, it couldn't be sustained in its present form.
Speaking on Firstline, Parker said National was "putting their heads in the sand" by refusing to raise the age of eligibility for getting superannuation.
Parker's comments come after a draft review of New Zealand superannuation released yesterday by the Commission for Financial Literacy and Retirement Income, called for a lift in the retirement age and a change to how increases were calculated.
The report recommended pegging the eligibility age for the universal state pension to longevity, meaning it would rise over time, and linking increases to inflation rather than wage rises.
It said one in four New Zealanders would be over 65 by mid-century.
Yesterday, the Government said it was sticking to the 65 years.
Associate Finance Minister Steven Joyce said fiscally responsible governments could afford to keep the eligibility age for NZ Super where it was.
"It is important to stick to that commitment because we are talking about people's lives here, and the way they plan for their retirement, how long they get to pay off their house, and all those sorts of things," Joyce said.
Told Treasury's long-term projections showed the cost of NZ Super combined with the cost of healthcare was ballooning, Joyce said: "Our view is retirement at 65 is affordable in the New Zealand context."
Prime Minister John Key has also said in the past, he would resign before raising the retirement age.
But Parker said he thought people largely understood raising the retirement age was a responsible policy.
"Everywhere I go in the country, people are saying to me this is a looming issue that a responsible government would deal with," he said.
"Just about every other Western government is doing the same thing - whether it's Australia, or further afield. They're realising that as people live longer, and live longer in retirement, you do have to gradually increase the age for eligibility for superannuation.
"We're not saying put it up overnight, we're actually saying that from 2020 onward, it should be put up by two months a year so that it goes up to 67."
He said Labour would also make allowances for people who worked in manual occupations and were perhaps worn out by 65, they would get their superannuation when they needed it.