Rob Stock Sunday Star Times 18 September 2011

The political  conspiracy of silence around the sustainability of NZ Super needs to end, says Retirement Commissioner Diana Crossan.

Crossan asked the government to consider a raft of major and minor changes to NZ Super last year, but is disappointed the government won’t explain its refusal to even debate the suggestions.

A request by the commissioner for an explanation has come back effectively blank, with the government refusing to justify its decision.

That has left Crossan with a growing sense that an issue of national importance is being left to drift beause of its political sensitivity, to the point that even recommendations to change minor “unfairnesses” in NZ Super will not be debated.

The knock-back has led Crossan, whose contract runs until 2013, to speak out, saying the people who would be most affected – those in their 40s or younger – understand that change is needed and are ready to accept it.

With the population ageing, NZ Super is going to consume a greater proportion of GDP. All around the world countries faced with similar demographics have moved to alter aspects of their schemes such as the age of eligibility to reduce the upward rise in costs.

In its three-yearly review of retirement income policy last year, the commission suggested lifting the age of NZ Super eligibility to 67 from 65, as well as changing the way NZ Super is indexed.

Crossan said those in their 40s and below, while concerned, have accepted they will be working longer.

“They say it is just a no-brainer, and they are ready to do it,” said Crossan.

“I think the population is geared up. I think people are saying, `What is the difference between 65 and 67?”‘

People recognised we will be living longer and more healthily.

Already New Zealand had a higher proportion of people working past 65 than most countries, Crossan said.

“While Mr Key and Mr Goff didn’t engage in the conversation, just about everybody else did,” Crossan said.

And she thinks she knows why.

“My understanding is that the politicians are nervous of the older people vote, and any tinkering with NZ Super sends older people into a spin.

“They think you are talking about them.”

Any tinkering has to be done very carefully because NZ Super is not generous, Crossan said,

But even the most minor suggestions now seem to be seen as third rail issues – one touch of them and a politician is dead.

“We asked for minor unfairnesses to be sorted out, and all we got back was a comment that they would make no changes. We asked why. I’m not even getting that.”

Those suggested changes included paying couples living together the same amount as non-couples living together and abolishing the rule allowing a person’s pension to be reduced if their partner receives a pension from overseas.

“They are just not going to look at anything to do with NZ Super,” Crossan said.

Crossan would like to see a non-political cross party accord on NZ Super, which she sees as a national treasure, to establish a long-term plan to ensure its survival as a universal benefit.

She fears though that the most likely scenario is that changes will be brought in in a rush that gives those who will be affected little time to prepare.