John MacDonald: NZ Super shouldn't be beer money for those who don't need it

Why should one person’s lifeline be another person’s beer money? 

That’s how I’m feeling about this stat that’s come through from the Retirement Commission, that there are about 50,000 people claiming the NZ Super pension while also earning more than $100,000 a year. 

Which has the commission saying that maybe it’s time we thought about testing people to see if they really need the NZ Super. But I think we’re beyond the point of “maybe” on that one.  

What I think we have to do is get real and stop this nonsense where someone can be earning a truckload of money and still have their hand out for the pension. 

But, of course, as soon as you get talk about cracking down on this, we’re reminded that the sense of entitlement that the younger generations are accused of having is just as rampant in all age groups. 

There’s the classic line: “I worked all my life and I deserve the pension”. 

Yep, absolutely. I get that. But what if someone is still working beyond the age of 65 and pulling in more than 100k a year? You really think they “deserve” the pension? 

I don’t. And I think we need to drop this idea that, just because we stick around long enough, we should get NZ Super irrespective of whether we need it or not.  

Which is why I’m saying, why should one person’s lifeline be another person’s beer money? Because, for many people, they pretty much can’t get by without the Super. 

Others, though —you might know someone like this; you might even be one yourself— they openly acknowledge that they don’t actually need the pension money but, by God, they’ve worked for it and they’re in boots-and-all. They almost brag about it. 

The pension is, literally, their beer money.  

I’m not advocating asset testing. I think that would be a step too far. Because someone might have, say, an $800,000 home but they can’t buy groceries with the equity in the house, can they? 

What I’m saying we should be doing, is income testing people before they get NZ Super. And I’d make the $100k mark the cut-off point. 

Because if you’re older than 65 and you’re earning $100k-plus, you’re like a pig in muck, aren’t you? 

Generally, if someone’s a parent, the kids are off their hands by the time they’re 65. There certainly aren’t the costs that come with raising a family when you’re younger, anyway. 

A lot of people over-65 are mortgage-free. There are probably less in that position these days than there used to be. But you get what I mean. Life, when you’re over 65, isn’t as expensive as it is when you are younger. 

So how much do you think would be saved if we did this, right now. If we stopped paying NZ Super to people bringing-in more than $100,000 a year? 

Weekly Super payments range from just over $400 each for a couple, to just over $530 for a single person living alone or with a dependent child. 

So, for the purpose of this discussion, let's round it out to $500 a week. Times that by the 50,000 people earning more than $100,000 who I say shouldn’t be getting NZ Super, and guess how much it comes to? 

$1.3 billion. That’s how much we are paying people in pension money to people who are already earning $100k a year.  

And that $1.3 billion is going to continue going into these people’s pockets - not because they need it, but just because of their age. 

Which, putting it plainly and simply, is nuts. 

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