Labour to dump pension pledge

02:56, Nov 01 2013

Labour is set to dump its pledge to increase the state pension age.

But it looks likely to keep an increase open as an option, despite calls to drop the promise in favour of holding the age at 65.

A policy workshop at its annual conference this afternoon further watered down a proposal that would have removed the target age of 67, which the party campaigned on in 2011, but commit the party to lifting the age above 65.

The change, which will now go to the full conference for approval on Saturday, adopted a recommendation of the union affiliates for inclusion in the party's high level policy platform.

It commits Labour to a universal superannuation system that is sustainable, but lists raising the eligibility age as only one option to achieve that.

Former MP Jenny Kirk spoke strongly against lifting the age.

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She said the Northland branch wanted all options investigated to maintain the current age of 65. Lifting the age to 67 was "an electoral turnoff".

But finance spokesman David Parker swung the meeting arguing for the party to leave an increase open and not to commit it to holding the eligibility age at 65, as some delegates advocated.

He said life expectancy was rising faster than the proposed incremental rise suggested by Labour, which in its 2011 policy would have lifted the pension age by two months a year from 2020 until it reached 67 by 2032

The party also had to be aware of being fair to younger generations. The cost of the state pension had risen from $8b to $11b in the last five years.

Parker said there was also a political dimension to leaving a rise in the pension age open.

Labour was always positioned as a tax and spend party by National and as finance spokesman he would have a much harder job promoting extra spending on Labour policy in health and education if the age was held at 65.

Council of Trade Unions secretary Peter Conway, representing South Wellington, said the affiliates proposal approved by the workshop was "constructive and pragmatic and preserved 67 as an option. "It's neither in nor out," he said.

Fairfax Media