KiwiSaver: A jewel in the crown of New Zealand's retirement income framework?

Abstract

New Zealand is a relative newcomer to the world of national superannuation vehicles to support private saving. In 2007, just before the GFC, New Zealand implemented KiwiSaver—a voluntary superannuation system to sit alongside the government pension, New Zealand Superannuation (NZS). Being a small nation in the South Pacific has never stopped New Zealand from standing out from the crowd. Whether in rugby union, the America’s Cup or economic reform, the world has watched with interest because New Zealand is seen to be doing things differently and often winning. Retirement income policy is no exception, with the innovation of automatic enrolment in KiwiSaver among other distinctive features of its design. The examination of retirement income policy in the current context of ageing populations, pressure on government budgets in terms of social support, the need to increase self-funding for retirement and the shift of risk and decision-making to individual investors enables us to learn from successful policy design and implementation in the face of challenges and the need for adjustment over time in response to changing environmental conditions.