KEY POINTS:
Dear Mr Peters,
I think I owe you an apology. I am sure politicians do not receive apologies very often - you lot do not generally back down from your hard-held positions and say that you have changed your minds and are sorry. However, I have changed my mind on something and want to acknowledge that you were right and I was wrong. Let me explain:
In the 1997 superannuation referendum I opposed your idea for compulsory superannuation because I don't like compulsion and there was no provision for people to apply their funds to repay their mortgage faster. However in the past few weeks, I have met several people who are starting to panic about their finances.
These people, generally in their 50s and 60s, are eyeing their latter years with trepidation and are regretting that they had done nothing earlier. Observing their alarm made me rethink compulsory super.
Now, I can't help thinking how much better off we would be if we had been compelled to save for the past 12 years.
Whichever way you look at it, there are not enough people who invest voluntarily and I can see little alternative to compulsory saving in individualised accounts. We would all have more money and better lives if we had voted for compulsory super in 1997.
Not only would this current generation be facing the future better prepared and more relaxed but so, too, would the next one, and the one after that.
The country would also be better off with a large pool of investment capital to fund the industries, the businesses and the infrastructure that we so desperately need.
Of course, even worse than your referendum result was Prime Minister Robert Muldoon in 1976 when he abolished the compulsory scheme that Roger Douglas had implemented a couple of years earlier.
Think how well off we would be now, more than 30 years later, had he retained that scheme. Muldoon's act will have to go down as the worst economic decision ever made in this country.
Sooner or later, we will have to convert KiwiSaver to some kind of compulsory scheme. We just won't save enough until we are forced to.
Yours sincerely,
Martin Hawes
