Prime Minister Christopher Luxon yesterday threw caution to the wind and abandoned his party’s 51-year-long opposition and proposed making KiwiSaver compulsory.
The proposal itself is fundamental enough.
Not only would KiwiSaver be compulsory, but all newborns would be auto-enrolled and given a $1500 boost to start their accounts.
That it is a National leader proposing this flies in the face of history and suggests that Luxon is on track to become one of National’s most significant leaders over the past half century.
He unveiled the proposal in his keynote speech to the party’s annual conference in Lower Hutt.
It is easy to see why.
The party has its back to the wall.
On current polling, it would lose 11 seats at the election, including those of some of its most senior MPs.
The Party President and every Minister who spoke and then Luxon himself all constantly repeated the mantra: the party has got to raise its party vote.
Obviously, they hope that the KiwiSaver proposal will be the circuit breaker that does that.
In his address to the conference, he portrayed it as a move to enhance the quality of life of retirees.
“For many Kiwis, especially those on low incomes, the self-employed, and many young people, saving for their future isn’t a priority,” he said.
“I think that’s a mistake.
“The truth is the single best time to start saving is when you’re young, because that’s when every dollar has the most time to grow.
“And while finding the room to save in a tight budget is tough, life in retirement without a reliable pool of savings can be so much tougher.”
There is one slight embarrassment about the policy.
It is almost exactly the same as “The KiwiSaver Generation” policy announced by New Zealand First on May 17, which proposed KiwiSaver compulsion and a $1000 payment at birth.
However, it was clear through the conference that National has taken the gloves off as far as ACT and particularly New Zealand First are concerned.
“Don’t vote ACT or NZ First thinking it helps National,” said Campaign Chair Simeon Brown in his address.
“It doesn’t.
“A party vote for NZ First only grows NZ First.
“A party for ACT only grows ACT.
Neither grows National.
“And sometimes it gets worse. In 2005, a party vote for NZ First was a party vote for Helen Clark, Trevor Mallard and Phil Goff.
“In 2017, a party vote for New Zealand First was a party vote for Jacinda Ardern, Chris Hipkins and James Shaw.
“Do you want to take that risk again?
“No, and I don’t either.
“You just can’t trust them.”
Luxon said New Zealand needed three more years of National “not bumper stickers, not slogans and not irresponsible promises that just make our country poorer.”
And he singled out New Zealand First’s pledge to buy back the Bank of New Zealand.
“It’s not serious just to spend $30 billion buying a bank when we already own one,” he said.
But the Prime Minister had an eye on the financial sector with the Kiwsaver proposal.
After his speech, speaking to the media, he said the country needed to drive to create levels of personal and collective savings and investment across the country.
“The funds that we lift here are also funds that get to be reinvested back in New Zealand in infrastructure and things that this country needs as well,” he said.
“So for us, it’s just a principal matter that if we want more financial security, we have to lift up our savings and investment rates.
“When we’ve looked at all the advice that we’ve had from different experts and different commentariat over a number of years now, this is just a common sense thing for us to do.”
What stands out about yesterday’s announcement is how much it runs against the grain of National’s superannuation policy since 1975.
National’s history was to the fore at the conference because this year is the party’s 90th anniversary of its founding.
Luxon drew on that to define its fundamental values.
“Ninety years ago, right here in Wellington, on the 13th and 14th of May 1936, our political forebears came together to found this party,” he said.
“Farmers, business owners, and community leaders – reeling from electoral defeat, in the depths of the Great Depression – determined to build a party that could defend the values they believed in.
“Values that faced grave threats then, from global conflict and economic turmoil, just as they do now: individual freedom, reward for achievement, national security, limited government and strong families and caring communities.
“Ninety years on, the recipe for success hasn’t changed.
“Sid Holland had it right in 1943, when he said the basis of New Zealand’s material future was a little word with big meaning – work.
“Work is at the heart of our party.
“We’re a party of farmers, working hard to beat the weather, compete offshore, and pay the bills.
“Of mums and dads, working double shifts, getting the kids to rugby practice, paying off the mortgage, and saving for the future.
“Of small business owners, working every hour of every day, risking everything they have on a bet that brighter days lie ahead.
“I didn’t leave my career in business and come to politics to take a break. I came to work.
“I came to work for a culture of opportunity, aspiration, and ambition.”
However, those values led Sir Robert Muldoon in 1975 to oppose and eventually demolish Sir Roger Douglas’s compulsory superannuation scheme because the contributions were paid into a state monopoly rather than private sector providers, as happens now.
In 1997, National again opposed a compulsory super scheme when NZ First Leader Winston Peters called for a referendum on it.
That opposition was led by former leader Dame Jenny Shipley, who, ironically, was at the conference yesterday.
National was sceptical about KiwiSaver from the beginning.
In 2015, then Finance Minister Bill English scrapped its “Kickstart” provision which gave every person signing up $100.
As recently as November last year, when Luxon announced new higher KiwiSaver contribution rates out to 2032, Finance Minister Nicola Willis made it clear she opposed compulsion.
Answering a media question about why, unlike Australia, we didn’t have compulsion, she said: “Australia is different from New Zealand in that they, on the one hand, do not have universal superannuation and, on the other hand, make private savings compulsory.
“Our position for New Zealand is different. Universal superannuation is here to stay, and at the same time, we think having KiwiSaver as a voluntary product makes sense.”
So why the turnaround?
“This is a policy whose time has come,” Willis told journalists after the Prime Minister’s speech.
What Luxon’s announcement of the policy in his conference speech did was lift the mood of the conference.
There had already been highlights like Erica Stanford’s speech on education, which drew frequent applause, and then a speech yesterday morning from Simeon Brown, which surprised many delegates with its verve and energy.
His task was to rev the conference up about the campaign.
“Labour has not changed,” he declared.
“Ten of its twelve most senior MPs today were ministers less than three years ago.
“Same people. Same instincts and same results.
“Labour are recidivist offenders.
“That’s right, they’re recidivist offenders, overspending, overborrowing, overtaxing. They just cannot help themselves.
“Just last week, they announced a new transport policy with numbers so dodgy, even Radio New Zealand said they didn’t add up.”
That was greeted with laughter and even some scattered applause.
But though the mood of the conference was undoubtedly upbeat, there was nevertheless a tension not far from the surface.
The party is dangerously short of winnable list slots.
POLITIK commissioned the Auckland lobbyist James Bews-Hair to run the figures produced in the Herald’s poll of polls on Friday through a model Bews-Hair has developed, which takes account of the current boundary changes.
He found that National, which averaged 32.7 per cent in the Herald poll, would get 34 electorate seats and just three list seats.
But his list of electorate seats that he is picking National to lose includes at least two that it is likely to win.
POLITIK understands that Labour’s polling for the Hutt South seat shows Chris Bishop well ahead of Ginny Andersen, and it would seem unlikely that Grant McCallum would lose Northland.
If both MPs hold their seats, that would leave National with only one list seat.
That would presumably go to deputy leader Nicola Willis and would see the departure of Gerry Brownlee, Paul Goldsmith, Melissa Lee and Nancy Lu.
POLITIK has learned that the party hierarchy is so concerned about this that they have tried to discourage at least one marginal electorate from putting up an impressive candidate who could win that seat.
Party President Sylvia Wood was circumspect about the issue when she spoke to POLITIK, but is obviously concerned about the prospect of the loss of senior MPs.
“Of course, we need good constituency MPs, but we need a party vote that means we get our top talent from there too,” she said.
That electorate, Auckland Central, with the assistance of two former party presidents, has fought back, and their preferred choice, Candace Kinser, is the candidate.
She will be up against Greens co-leader Chloe Swarbrick, and already large electronic billboards are appearing in central Auckland promoting her cause.
And she is optimistic.
“I’d say my chances are quite good, to be honest,” she told POLITIK.
“I think that Auckland Central has been underserved for a while in terms of a proactive MP that can link the conversation between City Council and Wellington, especially, as well as relating to the different communities, businesses and people within the electorate.”
If she wins, along with Bishop and McCallum, then National could be down to no list seats.
That is why so many speakers at the conference pounded on about increasing the party vote.
And the superannuation announcement has to be seen as an attempt at a circuit breaker to do that.
