Latest news with #Soviet-like
Otago Daily Times
5 days ago
- Business
- Otago Daily Times
Tough KiwiSaver changes
The milk was spilt in the retirement savings failure of 1975. How different and more prosperous might New Zealand have been if Labour's compulsory scheme had endured? Most retired New Zealanders would have had substantial nest eggs, and the nation would have benefited from the massive savings pool. Instead, Robert Muldoon stormed to power, and that was that. Universal New Zealand Superannuation, funded through taxes, took its place. Mr Muldoon described the scheme as socialist. Cossacks, epitomising a Soviet-like future, danced across television screens in an infamous and scurrilous ''attack'' advertisement. The respected financial analyst, the late Brian Gaynor, once described the abolition of the Superannuation Scheme as New Zealand's worst economic decision since that date. The scheme mandated 4% from employee and employer — the same figures Finance Minister Nicola Willis outlined in the Budget. She said minimum contributions would rise in two stages from the present 3%. In 2007, the Labour-led government, under prime minister Helen Clark and finance Mmnister Michael Cullen, introduced KiwiSaver. Designed as a voluntary, work-based scheme, KiwiSaver aimed to encourage long-term retirement saving and reduce reliance on government-funded pensions. It was not overturned by National. Initially, a $1000 kick-start encouraged participation, abolished by the National-led government in 2015. The annual contribution of up to $1042.82 halved in 2011 as part of cost-saving measures. Now, the government has announced the halving of the halving. More than $1000 in 2007 reduces to $260.72 in 2025 dollars. The cut is a money grab from a finance minister desperate to trawl for savings, estimated at $575 million a year for this measure. However, that contribution is proportionately more valuable for lower-paid workers. Their retirement savings, or first-home deposits, will suffer accordingly. Treasury and officials' advised Ms Willis that the contribution was ineffective as an incentive, an assertion to be treated sceptically. Ms Willis lacked the boldness to abolish the contribution altogether. Given the large sums, Labour should face pressure on whether it would reinstate the contribution. It failed to reinstate the kick-start or the $1042.86. Less disputatious is the decision to eliminate the contribution for those earning more than $180,000, a move that saves about $160 million a year. Increasing minimum contributions is fundamentally positive, although it comes at difficult times for employers and employees under economic pressure. An extra 1% will be hard to find for many. Increased contributions could also strengthen National's case to raise the superannuation age. There is a long, long way to go to match Australia's 11.5% saving (soon to rise to 12%). Furthermore, the entire 11.5% is untaxed, whereas New Zealand reduces employer KiwiSaver contributions through tax at the employee's marginal rate. Many retired Australians are now relatively wealthy. Government superannuation there is means-tested. The extra 1% bill for the government, as a huge employer, will be about $700m a year. Yet, the government and Treasury have made no allowances for this. It is either a ''fiscal cliff'' as the Greens have claimed, or it becomes absorbed into wage increases. In theory, KiwiSaver should be in addition to wages and salaries. In practice, it is often part of the salary package. Thus, the employee, in effect, pays some or much of the employer's contribution. The government's move to extend KiwiSaver to 16 and 17-year-olds is welcome. It encourages savings early. KiwiSaver has helped many New Zealanders into their first home and grow their retirement savings. But its benefits could never be spread evenly. Those in lower-paid jobs will have lower balances. Some, too, opt out, unable to afford the 3%, let alone 4%, or too tempted to spend that money elsewhere. Those who take time out of the workforce, often women, will inevitably be disadvantaged. KiwiSaver has, overall, been positive for many New Zealanders, despite average balances of only about $40,000. Erosion of the tax credit is a step backwards, one that significantly affects retirement security.
Yahoo
26-04-2025
- Politics
- Yahoo
Toxic Trudeau kept off campaign trail as he focuses on memoirs
He dominated Canadian politics for a decade. But almost nothing has been seen or heard of Justin Trudeau since he stepped down as prime minister last month. His Liberal Party, with a new leader, has the advantage as the country heads into a general election on Monday. Just so long as it can avoid reminding people of the scandals and missteps that eventually ended his political career. 'It's astonishing. It's almost Soviet-like how he's been erased from history. He never comes up, nobody ever talks about him,' said Dan Robertson, a conservative strategist. 'He's just vanished. And of course, if I were a liberal, if I were a liberal strategist, I'd be very happy with that.' It is not unusual for a candidate to distance themselves from a problem predecessor. Last year, Joe Biden was all but absent from Kamala Harris's campaign trail once he was forced to ditch his re-election bid amid concerns about his age and fitness for office. It meant Ms Harris could position herself as a candidate for the future, while aides claimed Mr Biden was simply busy being president and was not, as most observers believed, simply a political liability. Sources told a Canadian newspaper that Mr Trudeau had no plans to appear on the campaign trail, but was weighing two book deals and a proposal for a documentary. For now, he is reportedly renting a home in the capital Ottawa, so that his children can finish their school year, before moving to Montreal. The Liberal Party has moved quickly to remove his fingerprints from its manifesto, ditching some of his signature policies. It is working. Mark Carney, the former governor of the Bank of England who replaced Mr Trudeau as Liberal Party leader, is now favourite to win. It marks a turnaround from earlier this year. With Mr Trudeau in office, the Canadian Conservative Party looked odds on to win power for the first time in 10 years as they capitalised on his unpopularity. His personal stock had taken a pounding from a string of scandals, often self-inflicted. Photographs emerged of him in 'blackface' from before his time in politics. He was found guilty of breaching conflict of interest rules by accepting holidays on a private island and flights from the Aga Khan, a philanthropist and head of the Shia Ismaili religion. And an ethics watchdog concluded that he tried to improperly intervene in a criminal case against a construction company. His handling of the Covid pandemic, with vaccine mandates and shutdowns, provoked a backlash, and inflation soared as the country emerged from the crisis. By the end of last year, his approval rating had crashed to 22 per cent, and he was buffeted by ministerial resignations. 'This country deserves a real choice in the next election and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election,' he said when he announced he was stepping down. He has barely been seen since then. A day after his successor was sworn in, he posted a photograph of himself buying a potato masher and other kitchen implements from Canadian Tire, the sort of store that sells everything from car tools to homeware. For his part, Mr Carney quickly distanced himself from some of his predecessor's most important policies. He axed a consumer carbon levy and cancelled a rise in capital gains tax. That leaves it for Conservatives to remind voters of the man who led the country until a few weeks ago. Pierre Poilievre, the Conservative leader, has repeatedly described Mr Carney as Mr Trudeau's 'economic adviser' and in a televised debate accused him of using the same talking points as his predecessor. Mr Carney responded: 'I know you want to be running against Justin Trudeau. Justin Trudeau isn't here.' Nor is the former prime minister expected to be seen any time soon. 'He's staying far away from it all,' David Coletto, founder of polling firm Abacus Data, 'because Justin Trudeau is a liability for Mark Carney.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
26-04-2025
- Politics
- Telegraph
‘Toxic Trudeau' kept off campaign trail as he focuses on memoirs
He dominated Canadian politics for a decade. But almost nothing has been seen or heard of Justin Trudeau since he stepped down as prime minister last month. His Liberal Party, with a new leader, has the advantage as the country heads into a general election on Monday. Just so long as it can avoid reminding people of the scandals and missteps that eventually ended his political career. 'It's astonishing. It's almost Soviet-like how he's been erased from history. He never comes up, nobody ever talks about him,' said Dan Robertson, a conservative strategist. 'He's just vanished. And of course, if I were a liberal, if I were a liberal strategist, I'd be very happy with that.' It is not unusual for a candidate to distance themselves from a problem predecessor. Last year, Joe Biden was all but absent from Kamala Harris's campaign trail once he was forced to ditch his re-election bid amid concerns about his age and fitness for office. It meant Ms Harris could position herself as a candidate for the future, while aides claimed Mr Biden was simply busy being president and was not, as most observers believed, simply a political liability. Sources told a Canadian newspaper that Mr Trudeau had no plans to appear on the campaign trail, but was weighing two book deals and a proposal for a documentary. For now, he is reportedly renting a home in the capital Ottawa, so that his children can finish their school year, before moving to Montreal. The Liberal Party has moved quickly to remove his fingerprints from its manifesto, ditching some of his signature policies. It is working. Mark Carney, the former governor of the Bank of England who replaced Mr Trudeau as Liberal Party leader, is now favourite to win.
