National’s $2 billion savings swindle bites tomorrow

The National-led Government’s latest broken promise kicks in tomorrow when it cuts the amount it puts into each KiwiSaver account every year by up to $520, Labour leader Phil Goff said today.

From July 1, the Member Tax Credit paid by the Government into each KiwiSaver account to boost savings will be cut by 50 per cent.

“National’s latest broken promise takes $2 billion dollars out of the pockets of Kiwi mums and dads over the next four years, budget documents show, and forces them to dig deeper if they want to keep up their savings,” Phil Goff said.

“That’s some birthday present from John Key on the day the hugely successful KiwiSaver savings scheme turns four.

“The cuts are despite National Party leader John Key promising in 2008 that the Government tax credit ‘would remain intact’ and repeatedly telling New Zealanders that Budget 2011 would be a ‘savings budget’.

“John Key also said the cuts would not come into place till after the election.

“All three of these statements have been shown to be complete hogwash. The National Government $2 billion savings swindle takes effect from tomorrow.

“And that does not include National’s new tax on the previously exempt employers’ contribution, which starts next year and removes an additional $600-$700 million from savers over four years.

“This broken promise undermines the KiwiSaver scheme by feeding many Kiwis’ fears that the Government can’t be trusted to keep its end of the bargain and flies in the face of constant messages that we need to save more as a nation.

“It is another breach of trust by National and just the latest instalment of its appalling track record on savings, which has put us in debt to the rest of the world.

“National’s decision to cut contributions to the Superannuation Fund in 2009, which was set up by Labour, has cost New Zealand tens of millions of dollars in lost earnings so far.

“And if Robert Muldoon’s National government had not abolished Labour’s super scheme, New Zealand would now have a huge pool of home-grown funds.

“It is a tragedy for New Zealand that National has repeatedly played short term political games with the public on savings.

“If it had accepted Labour’s offers of a bipartisan approach we would be a much wealthier country.

“We would not have to rely on overseas borrowing to invest in our job-creating export businesses and New Zealanders would be in a position to own their own future.

“Labour will release its savings policy closer to the election. It will be fully costed and transparent,” Phil Goff said.

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