One thing you can be sure of when it comes to Grey Power is their insistence on re-litigating old arguments – talking about the Tax Working Group they say:

…reeks of shades of former Prime Minister, Jenny Shipley, when she set the amount of national superannuation back to 60% of the Net ordinary after tax weekly wage.

FFS, that was what, eleven years ago!

Grey Power feels that the recommendation is ridiculous that those earning $70,000 per annum receive tax cuts while those below that figure receive nothing.

Erm, no. The TWG recommends reducing both the top tax rate (38% on everything over $70,000) and the middle band 33% over $48,001 rate.

1. Is, apparently, encouraging saving

I was very cynical about this when KiwiSaver was launched. Only just the other week I speculated that it might have killed our already low rate of savings. However, the National Business Review reported yesterday that a survey by Colmar Brunton in August showed that 64% of people currently saving are also saving for their retirement, up from 58% in February this year, back to the high of 65% reached in February 2008, just before the recession struck. There’s a trend building:

2. John “Minto Bar” Minto hates it:

“Kiwisaver began the privatisation of government superannuation. It gives the biggest benefits to those on the highest incomes while reducing government responsibility to provide retirement income through taxation.”

All excellent reasons to support KiwiSaver: privatisation, rewards those who earn more and therefore rewards hard work, reducing government expenditure (well, only if the government had the balls to introduce means-testing for superannuation or raise the retirement age) and dependence. And pissing off an old socialist is such fun.

With time I also think the Government could phase out the incentives for joining KiwiSaver as the 2025 report suggests, as eventually they will start to actually hurt saving. It doesn’t make much sense to tax people then churn their money back to them in the form of savings incentives.

3. Encourages a culture of saving and investment:

Ok, anecdotal evidence only – from KiwiBlog the other day:

…what struck me, was the difference it has made at an individual level. I can’t imagine before KiwiSaver, three young women (who still have massive student debt) would be talking about their investments, who is getting the best rate of return etc. Developing that culture of savings and investment literacy at an early age is possibly KiwiSaver’s greatest claim to fame.

So, I’m a convert – KiwiSaver provides a means to privatise superannuation and encourage savings and investment. And it pisses off socialists like John Minto.