New Zealand Superannuation (NZS) is a universal pension paid at a flat rate. It is effective at poverty prevention among the elderly, relatively inexpensive and simple to administer. However, with the proportion of the population aged over 65 years set to increase rapidly over the next 50 years, there is expected to be a steep rise in the costs of the scheme. The future cost of NZS is therefore a major driver of New Zealand’s Longer-term Fiscal Challenge. The Treasury’s statement on New Zealand’s long-term fiscal position (Treasury, 2013a) examines ways of addressing this cost, as well as other possible responses to the broader fiscal challenge such as higher taxation or reductions in other areas of public spending.
Retirement income policy and national savings
