Your pension is being discussed

Grey Power proposal looks at disqualifying high earners. Photo / Brett Phibbs

Grey Power is studying a proposal to take the pension away from retired people who earn more than $80,000 a year.

The proposal is being sent out as a "discussion paper" and has already raised fury within the organisation.

It has also invited Retirement Commissioner Diana Crossan to speak to its ruling board before the end of the year.

The lobby group's dalliance with the "sacred cow" of New Zealand politics has already sparked anger in some sectors and prompted a renewed pledge from Prime Minister John Key to resign if superannuation was changed under his government.

The proposal, leaked to the Herald on Sunday, was written by Grey Power's Coromandel representative, Mac Welch, and distributed by the organisation's president, Roy Reid.

Welch described national superannuation as "unaffordable" and said the Government was "under pressure".

He wrote of hearing Grey Power members referred to as "old greedies" and it was time to consider means testing.

He said he wanted to start discussion around a $40,000 income trigger for reducing pension payments and completely cutting the payment at $80,000.

Earnings of $80,000 a year work out at $1180 a week. Welch's proposal would mean someone on that money would no longer be able to collect the $340 a week pension payment as well.

Welch said he was disappointed the paper had been leaked.

He said he had received a mix of negative and enthusiastic comments in the short time since the paper had been sent to regional Grey Power branches around the country.

He said he had yet to reach retirement age of 65 and so was not eligible to collect the pension.

Grey Power secretary Jan Pentecost said the view was not Grey Power policy, which was to maintain superannuation at its current level.

Crossan, who was sent the discussion paper, said the Retirement Commission's research dismissed means testing because it created administration costs and led to people trying to disguise their incomes.

She said raising the retirement age was a better way of addressing the cost burden of pension payments, but the prime minister was impossible to budge on the issue.

She said Key had ruled it out three years ago and not moved. "I think it was probably a statement for political reasons that he wishes he hadn't made."

A spokeswoman for Key said: "As he has said on numerous occasions, the prime minister will resign if that stance changes."