KEY POINTS:
Half of the employers at a big meeting on Auckland's North Shore yesterday still did not feel ready for KiwiSaver, two days after the savings scheme came into force.
Employers and Manufacturers Association official David Lowe asked 140 employers at the Albany meeting how many felt ready for KiwiSaver.
"Just under half put up their hands," he said.
Employee reactions on the first working day of the scheme yesterday seemed equally mixed.
At Atlab, an Australian-owned film processing company with nine local staff in Newmarket, only three employees, including manager David Donaldson, plan to join.
But at Auto Parts in Manukau, where husband and wife owners Brendon and Deirdre Stirling have started topping up their workers' savings with 2 per cent from the company immediately, almost two years ahead of the legal requirement, two out of their three full-time employees have opted in.
"I have two young kids and a wife that loves shopping, so for us it's impossible to save," said salesman Stuart Nolan, 35. "This is an easy way of doing it."
His colleague Luke Mostert, 22 and single, said he wouldn't notice the cost because his KiwiSaver contribution would come out of his pay before he received it.
"I will be joining it, because if you do something privately you are not going to get all the benefits you can get out of the Government scheme," he said.
The Inland Revenue Department reported a record 14,200 hits on its KiwiSaver website over the weekend but no evident problems as employers and employees got to grips with the system.
Waikato Chamber of Commerce chief executive Ray Lewis said his phones were "very quiet", although he expects Prime Minister Helen Clark to face questions on the issue when she speaks to chamber members in Hamilton today.
Mr Lowe said only two or three of the 140 employers at the Albany meeting said they had new employees starting work yesterday. By law, new employees from July 1 have to be enrolled in KiwiSaver unless the employer has a company-sponsored super scheme which has been granted an exemption.
He said questions from employers showed there was still a lot of misunderstanding of KiwiSaver.
For example, many could not see why the employer's contributions were exempted from withholding tax while the employee's contributions had to be made out of after-tax income.
Employers and managers who were still working at age 65 or over were also angry about being excluded from the KiwiSaver scheme, which can only enrol people before the qualifying age for national superannuation.
"They are hearing about all this free money and wondering why they can't get it," Mr Lowe said.
The Stirlings at Auto Parts said they were adding 2 per cent to their employees' contributions from day one, rising to 3 per cent next April and 4 per cent a year later, because they wanted to help their employees.
"We have always run like a family. The business can't grow without them, we have to share the load," Mr Stirling said.
"Our view is that it's a good idea long term. A lot of our workers are not disciplined enough to save and think this gives them some opportunity."
Mr Nolan's wife Lisa, who also works for the company part-time, said the discipline of saving 4 per cent of the family income would force her to cut back on cigarettes. She said that if it was a choice between cigarettes and money then she would take the money.
But at Atlab, KiwiSaver will have the perverse effect of cutting Mr Donaldson's savings.
He has been putting about 7 per cent of his income into a private super scheme, but has put that scheme on hold for a year to get the $1000 Government kickstart on offer from KiwiSaver.
"I think I'd be crazy not to take the free $1000," he said. "I'll go to this for a year, then go back to my other fund." But only two of the other eight people in the company are joining.
Patricia Boyle, 40, said she could not afford to join because of a recent separation, leaving her caring for her two teenagers.
"In a year or two I might join, but just now it's financially not viable," she said.
Mark, a 51-year-old engineer who declined to give his surname, said he would not join.
He plans to retire to Greece in 18 months on his pension earned from 20 years in the Air Force.
