Changes to super fund recommended

12.30 pm

Parliament's Finance and Expenditure Committee has recommended changes in three key areas of the legislation for the Government's proposed new superannuation fund.

The legislation will set up a fund to help provide pensions for the increasing ageing population.

A majority of MPs on the committee voted for technical changes to the bill, saying "it is not a solution to all retirement income policy issues and we do not consider this bill will end debate on the issue".

The changes would require fund managers to spell out clearly where money can be put to invest it ethically. They would toughen procedures ensuring the independence of the government appointed guardians overseeing the fund and establish a consultation process for any future changes.

The committee has also recommended the Government carry out a public education programme to explain the fund and encourage private savings.

Despite the committee process, further changes are to be discussed tomorrow by Finance Minister Michael Cullen and New Zealand First leader Winston Peters.

The Government needs NZ First's five votes in Parliament after the Greens rejected the idea of setting aside part of the Government's surpluses to partially meet the future costs of superannuation.

Mr Peters' priority is to ensure the fund could be split into individualised accounts, if a future government so wanted.

Finance Minister Michael Cullen has set aside $600 million for the fund this year.