Brash's KiwiSaver double act

Don Brash. Photo / Herald on Sunday.

Say what you like about Don Brash's ambitious but impotent 2025 report he, at least, has been selfless in approach.

So selfless, in fact, that one of his recommendations, if implemented, would almost certainly wreck a business of which he is a director.

Brash's recommendation 9 that the last of the "KiwiSaver subsidies should be abolished" would render the scheme almost pointless, forcing both providers and members to exit forthwith.

As chairman of the Huljich KiwiSaver scheme, Brash must know that.

Without the government throwing in an extra $1,043 each year I think most KiwiSaver members would just take a holiday and make more short-term plans for their money.

You can argue - quite successfully - that the $1,043 government KiwiSaver contribution is simply your own money recirculated via the IRD back to yourself. It is a kind of psychological trick designed to make us save for the long term.

But the unanswered question is whether anybody would lock their money away for 40 years without these kinds of tricks.

Brash doesn't have an answer for this either except to restate his belief that with tax cuts people would freely make rational decisions about long-term investments.

Nice thought.

He's also sceptical of that Aussie claim to greatness - its compulsory superannuation system - with the Brash report "not convinced that the compulsory private savings scheme has made a material difference to Australia's economic performance".

"It has, however, clearly generated considerable additional business for funds managers, lawyers and accountants," the report says.

Like that other KiwiSaver critic, Michael Littlewood, who is a director of Superlife KiwiSaver, Brash hasn't let his personal convictions about the scheme's worth stand in the way of business considerations.

And who can blame them?

David Chaplin

pictured: Don Brash. Photo / Herald on Sunday.