Savings industry wants framework plan

In a significant change of tack, the savings industry has a plan to get agreement among politicians, employers and trade unions on a formula to boost New Zealanders' private savings.

Announcing its Saving New Zealand project today, the Investment Savings and Insurance Association is moving away from its longstanding approach of urging people to save more for their retirement or pleading with the Government for friendlier tax rules on savings.

Instead, the new three-stage project aims to get a range of groups involved in setting a broad framework for private savings before it attempts to address more sensitive detailed policies.

It wants an enduring savings regime with political, industry, employer and union backing.

The plan will show New Zealanders what retirement income they can expect from the state and how they can supplement this with their own savings, especially through workplace superannuation schemes.

"At the end of last year we looked at how effective our efforts were in promoting the need for change," ISI deputy chairman Ross Kent said.

"We found that there was a broad understanding about the need to save, but otherwise it just hadn't been working.

"It seemed there was a lot of interest in savings around the market, but little of that was borne out in individual, political or media comment."

Much of the superannuation debate in the past decade had been "adversarial" and centred on the state-provided pension, Mr Kent said.

It was now time to focus on sustainable rules for private savings - not just for retirement, but for education, buying a house, health needs or retraining for a job.

The new project has been set out in three phases:

* Discussions with employers, unions, politicians, economists to "test the water" on creating a "different" approach.

* Development of a savings issues paper before a savings forum to be held in late July.

* Development of policy detail.

"I think it's realistic to expect that we would get through the process in sufficient time for detailed policy parameters to be developed for party manifestos going into the next election [in 2005]," Mr Kent said.

- NZPA