The Deputy Prime Minister of NZ kicked off Labour's 2023 Election Campaign with a promise to not raise the pension age. The Deputy PM stated:
"Unlike National and Act, today I am confirming we will not be lifting the age of eligibility for NZ Superannuation. We’re keeping it at 65, as most NZ'ers want .. We have one of the simplest superannuation schemes in the world. It is universal & generous .. As long as we keep paying in to the Super Fund it is also affordable".
The Deputy PM stated to OneNews, "We've got the numbers in front of us, Treasury tells us its affordable as long as we keep contributing to the Super Fund".
So let's put Treasury's numbers in front of us. Its Long Term Fiscal Position Statement says:
"NZ Superannuation expenditure is projected to grow from 5.0% of GDP in 2020 to 7.7% of GDP by 2060 as a result of demographic change. The NZ Super Fund smooths this increase but does not fully fund it". The Treasury states, "In 2060 the NZ Super Fund will cover 0.4 percentage points" of the total cost. In other words, the Super Fund will not cover the increased costs by a long way.
The NZ Treasury says that, given current settings, our pensions and health-care spending is on an unaffordable path due to population ageing, meaning that taxes and debt will have to be increased to pay for them, contradicting the Deputy PM. The Treasury outlines different ways the government "could seek to raise more revenue to respond to these long-term fiscal pressures". Wealth and capital taxes feature. Future pension (& health-care) obligations constitute a huge liability on the government balance sheet that the Deputy PM has denied.
If a company director understated the size of liabilities to mislead the shareholders about what was "affordable", then they could be jailed.
Sources:
https://www.scoop.co.nz/stories/PO2305/S00196/speech-labour-congress-2023-speech-carmel-sepuloni.htm