Mike's Minute: Why is the NZ Super debate back?

Like so many debates in this country, another one has restarted, this time around Superannuation. 

Some economists have taken to their calculators and looked at who earns what in retirement. 

9% of over 65s are earning more than $100k a year. 

3.6% are earning more than $150k a year. 

A smidge over 2% are earning more than $180k a year. 

Now that’s almost 15% earning at least a six-figure salary, which I was pleasantly surprised about given the general Super debate is predicated on the idea everyone in retirement can't make ends meet, are cold because they haven't got a heater, and generally aren't eating properly because lamb chops are beyond the budget. 

Anyway, upon crunching these numbers said economists asked: why don’t we means-test Super? 

They are of the camp Super is not affordable. 

That is still in some doubt, and while it is in some doubt, we haven't been able to get past the first hurdle and the first hurdle is: why don’t we raise the retirement age? 

Close followers of this increasingly laborious debate will have noted we can't even get any sort of agreement on age, so why you would raise a means test is beyond me. 

Age at least doesn’t change the fundamental underpinnings of Super i.e. it's an entitlement and age is the sole trigger. 

Means-testing puts it into a whole new category, and the category would be called a benefit. Age becomes secondary to your means. 

"Welcome to your golden years. Oh, you're rich? Well, nothing for you". 

But what about my contribution to the tax base and the state of the nation? "Oh yes, they were old rules that only counts if you're broke". 

If you ever opened that Pandora's box, you may as well do away with Super altogether. Because once you turn it into a benefit you may as well call it Jobseeker – you're simply 68-years-old and unemployed.  

When in the modern age, given the reason for upping the age of entitlement is partially based on the idea that people live and work longer, are you actually no longer working? 

If 65 is too young to retire, when is a good age? That's another debate that will go nowhere. 

There should be a new rule: don't start new debates until old ones are settled. 

And given we are still at 65-years-old after literally decades of going nowhere, then means-testing Super is wasting our time. 

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Episode Transcript

Speaker 1 (00:00):
The Myke asking breakfast six and eight week days. I'm
used talk top you know there.

Speaker 2 (00:05):
The debate has restarted, Like so many debates in this country,
this one around the superannuation. Some economists have taken to
their calculators and looked at who earns what in retirement.
I found this but really interesting. Nine percent of over
sixty fives are earning more than one hundred thousand dollars
a year, three point six percent are earning more than
one hundred and fifty thousand dollars a year, and a
bit over two percent are earning more than one hundred

(00:26):
and eighty thousand dollars a year. Now, that's almost fifteen
percent earning at least a six figure salary per year,
which I was pleasantly surprised about given the general super
debate is predicated on the idea that everyone in this
country in retirement can't make ends, meat are cold because
they can't afford a heater, and generally aren't eating properly
because lamb chops are beyond their budget. Anyway, upon crunching

(00:46):
these numbers, said economists then said, why don't we means
test super? They are of the camp super is not
affordable that is still in some doubt, of course, and
while it is in some doubt, we haven't been able
to get past the first hurdle. And the first hurdle
is why don't we raise the retirement age?

Speaker 1 (01:04):
Now?

Speaker 2 (01:04):
Close followers of this increasingly laborious debate will have noted,
we can't even get any sort of agreement on age,
so why on earth would you raise means testing? It's
beyond me Age at least doesn't change the fundamental underpinnings
of Super i e. It's an entitlement and age is
the sole trigger. Means testing puts it in a whole

(01:25):
new category, and the category would be called a benefit.
Wouldn't it age become secondary to your means Welcome to
your golden years old, Oh, your rich world. Nothing for you,
But what about my contribution to the tax space and
the state of the nation. Oh yeah, they were the
old rules that only counts if you're broke. If you
ever open that Pandora's box, you may as well do
away with super altogether, because once you turn it into

(01:48):
a benefit. Think about this, Once you turn it into
a benefit, you may as well call it job seeker.
You're simply sixty eight and unemployed when in the modern age.
Given the reason for upping the age entitlement in the
first place is partially based on the idea that people
live and work longer. When are you actually no longer working?
If sixty five is too young to retire, when's a
good age? That's another debate that will go nowhere. Of course,

(02:09):
should be a new rule. I've decided the new rule
should be, don't start new debates until old ones are settled.
And given we're still at sixty five after literally decades
of going nowhere, then means testing super is wasting our
top The Mike

Speaker 1 (02:24):
Asking breakfast six to nine weekdays on news Talks AB