Media Release

Mercer: No budget changes good for stability of KiwiSaver
Thursday 28th May, 2009

The fact the Government did not make any significant changes to KiwiSaver in today’s budget has drawn applause from Mercer, one of the Government’s six default KiwiSaver providers.

Mercer’s New Zealand Business Leader, Martin Lewington, said he was delighted there had been no further changes to KiwiSaver in this budget.

“In just two years KiwiSaver has had a lot of changes, it’s absolutely critical now that both the Government and KiwiSaver providers are doing everything they can to ensure stability in the system and to improve member confidence and understanding of KiwiSaver as a long-term savings tool for retirement,” he said.

“We’re encouraged – and New Zealanders should be too – that the Government has protected member tax credits in KiwiSaver, ensuring it remains an effective savings vehicle for retirement.

The Government did state in the Budget announced today that KiwiSaver Schemes could not provide mortgage diversion options within their products. This applies from 1 June, 2009 and reflects the low level of interest by members.

“We’re pleased there is now clarification around the issue of mortgage diversion within KiwiSaver,” Mr Lewington said.

“We believe there are still some improvements to be made to make KiwiSaver a truly world-class retirement system, and to encourage collective participation among New Zealanders so everyone has the opportunity and financial knowledge to start making retirement preparations.

“However - we have a strong savings framework in place, which needs stability and consistency if New Zealanders are expected to embrace it and benefit from it, and the Government has helped improve this stability by making no changes in the budget” he said.

ENDS

more information, visit www.mercer.co.nz

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