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KiwiSavers are reporting six-month delays in their employer contributions reaching their accounts, and say when payments do appear they bear no resemblance to the actual amounts due.
Emails from investors experiencing problems with the transfer of their employer contributions continued to pour in yesterday, following the Herald's coverage of the issue this week. By last night the paper had received more than 50 emails.
Wellington man Gerard O'Donnell, a client contract specialist for an IT company, said only one of his employer payments had turned up in his Gareth Morgan KiwiSaver account since April 1 when the contributions became compulsory.
He had repeatedly phoned the Inland Revenue Department, to be told variously that it was a temporary systems error, a problem at his employer's end, and an inbuilt delay.
He had checked with his employer and the contributions had been made.
While he didn't fear the money was missing, he was annoyed it was not in his account and in use. This was the time to take advantage of lower priced investments and benefit from an eventual market recovery, he said.
"It's more the opportunity cost. It's sitting there, and there's no way of really getting a definite answer from them as to why it's not going through."
IRD pays net interest of 5.36 per cent on both employer and employee contributions waiting to be allocated to an account, but O'Donnell said this would not compensate for missing a major upshift in the financial markets.
Sue Murdoch, who works in customer support for a Waikato manufacturing company, said she was missing around a third of her employer contributions. Those payments that had arrived were in strange amounts.
"All I see is maybe an amount of $19 go in and then two weeks later I'd see another amount of $6 go in. Like I had an employer contribution of .06c go into my account in August - it's just random."
Also with Gareth Morgan KiwiSaver, Murdoch had inquired at IRD several times and was only told this week that there was a problem. "Other than that it was my fault, I had to wait, I wasn't looking properly."
She had viewed payroll printouts from her employer detailing all the amounts that had been transferred to IRD.
Wendy Davis processes the payroll for a large education provider and said her company electronically sent all deductions to IRD twice a month, as required by law.
Despite this it had had problems processing requests from staff to opt out of KiwiSaver because IRD said it had not received all of their contributions.
She was horrified to discover last week that one employee who had supposedly opted out had actually been a member of the scheme for over a year. "When I asked [IRD] what had happened to the funds, both employee and employer for this person over the last year, I was told they would be 'somewhere'."
Heather Daly, group manager customer operations for IRD, said sometimes there were shortfalls in employer contributions and when that happened IRD would divide the contribution between employees of that company.
She said sometimes employers made mistakes like placing information in the wrong fields, or the employer report and the amounts sent did not tally. IRD was working with employers to educate them.
IRD said that as at October 1, 93 per cent of employer contributions had been processed.
