Retirement Policies: The Consequences

Ruth is one of several hundred New Zealanders denied NZ Super on the basis of choosing the wrong partner.  Because she is married to Bill, an American receiving retirement income from the United States greater than the amount of NZ Super paid to married couples, New Zealand determines that the US - not New Zealand - is therefore responsible for providing Ruth’s retirement income.

Ralph has lived and worked all his life in Napier.  He is married to Ingaborg, a former citizen of Norway.  The NZ Government has denied Ralph his right to NZ Super and determined that Norway - not New Zealand - is responsible for providing his retirement income.

Justin has worked almost his entire adult life in Christchurch, living in a permanent relationship with Hans, formerly from Germany.  With the passing of the Civil Union Bill, the NZ Government now refuses to pay Justin any form of NZ Super, determining that the Federal Republic of Germany is henceforth responsible for providing Justin’s retirement income.

Imagine the consequences for New Zealand if the US, Norway and Germany (or any country for that matter) opted to turn the tables and introduce legislation denying state pensions to any of their citizens choosing a New Zealander as a partner - insisting that the NZ Government must now provide their retirement income.

Of course, no other country has reacted in this manner.  International protocols and treaties protecting people’s pension rights are honored by countries around the world (that is, with the exception of New Zealand).  However the US, Norway, Germany and a host of countries with high pension rates have objected to any form of social security arrangements with New Zealand.  In consequence (as the February 2003 Review points out) the financial loss to New Zealand has been considerable.

The United States has taken it a step further.  US Social Security payments are sent out to people who have contributed to the US program regardless of where they are living in retirement.  However, the US has blacklisted New Zealand along with “rogue” states (North Korea, Iran, Libya), refusing to pay US Social Security pensions, worth millions of dollars, to eligible NZ citizens when they leave the US.  For 12 years Ruth had paid into the US Social Security program, only to lose her investment for this very reason.  Ruth, eligible for both US Social Security and NZ Super, has been denied both - a double whammy.

New Zealand’s retirement policies have contributed to a marked decline in the number of skilled professionals wanting to immigrate to New Zealand.  The policies have also acted as a deterrent to encouraging overseas New Zealanders to return home. 

Last modified: February 21, 2007