The Government's Reaction

The review was prepared by people who advise and inform the government, people who know a great deal more about Superannuation and Portability than any politician, including the two Ministers to whom it was addressed.  It is authoritative and convincing, leaving no doubt that the current system is seriously flawed, discriminatory, and in dire need of reform.  The review’s proposals are too sound, too logical and too important to the national interest for a responsible government to ignore.

However, after considering the information and recommendations on Superannuation and Portability submitted over a 3-year period, the two Ministers decided against the advice put before them.  According to Mr Maharey, the proposals made by MSD officials would not bring any advantage to the majority or even a substantial minority.  The Minister alleged the proposals would, in fact, have a negative effect on the current system, a system cherished by all New Zealanders; furthermore, the high administrative costs of change were another consideration favoring caution.

In dismissing the advice of MSD officials, Mr Maharey may have been confident that no one would ever see any of the reports in their entirety and thereby be in a position to question his judgment.  Through unexpected circumstances  the review became available for people to see – calling into question the Minister’s credibility as a result.

In light of the review’s content, it is clear that the Minister’s claims – namely, that the proposals would not bring any advantage to a substantial minority – are contrived.  The Minister (who had previously supported bills affecting minorities including legalizing prostitution and Civil Unions) ignored the original intent of the review: to find a system that was more equitable and more in keeping with the times, a system that offered greater portability and no longer disadvantaged a substantial minority.

The Minister rejected a thoroughly researched, logical resolution that would have changed the current system into a program based on equity and immediately improved the lot of up to 60,000 elderly NZ residents.  It would have benefited thousands of overseas New Zealanders, treated Pacific Islanders more generously and been welcomed by our Asian population whose interests have largely been ignored.  The Minister vetoed changes that would have opened the way to a social security arrangement, and the likelihood of a free-trade agreement, with the United States.

A Party spokesperson has subsequently explained that although the review’s proposals are persuasive, they fail to take into account political considerations. The mere mention of changes to NZ Super would send waves of alarm through elderly voters whose continued support is in the Party’s interest.

Last modified: February 21, 2007