A major review of New Zealand’s retirement income policies is set to get underway by Te Ara Ahunga Ora Retirement Commission.
Minister of Commerce and Consumer Affairs, Hon Dr David Clark has released the Government’s terms of reference which outline the focus of the 2022 review.
Under the New Zealand Superannuation and Retirement Income Act 2001, the Retirement Commissioner is required to carry out a Review of Retirement Income Policies (RRIP) every three years.
Key topics to be focused on for the 2022 review relate to three broad areas comprising New Zealand Superannuation, housing, and private savings including KiwiSaver.
Retirement Commissioner Jane Wrightson says particular focus will be given to the impact current policies have on the retirement savings outcomes and experiences of Māori as Treaty partners, and of Pacific Peoples, and women.
“In general, these three groups tend to arrive at pension age less economically well-off and it’s important that the reasons why are clearly understood from a systems perspective,” she says.
A number of key research pieces will be undertaken to identify emerging issues and will be included in a final report to Government along with recommendations relating to retirement income policies.
Wrightson welcomes the targeted areas of focus for the upcoming RRIP and thanks the Government for the release of its full response to the 2019 review.
“It’s good to see a number of the recommendations made in the previous review already actioned, or in progress, and we look forward to building on this momentum in 2022.
“The RRIP enables us to do a deeper dive into the key topics identified by the government which will surface valuable insights into what retirement looks like for New Zealanders and what their needs are for the future,” she says.
“We know housing affordability issues are not just affecting first-home buyers but also older New Zealanders. Through this process we will be able to gain greater understanding of the adequacy of NZ Super for future retirees who are renting or are still paying off mortgages.”
Another area of focus will be around KiwiSaver, in particular decumulation, or expenditure in retirement.
“A lot of attention has been given to the accumulation phase of saving in KiwiSaver, but more could be done around what happens next when retirees need to plan how to best use their savings and investments to enable them to live as comfortably as they can when they stop working,” says Wrightson.
“Throughout the review process a range of people and organisations will be engaged with to ensure we capture the breadth of views reflective of the diversity of New Zealand. These insights will be used to help formulate the final report to government in December 2022.”
For more information about the terms of reference for the 2022 review of retirement income policies and the Government’s response to the 2019 review visit https://retirement.govt.nz/policy-and-research/2022-review-of-retirement-income-policies/.
