New superannuation scheme

Press, Volume CXV, Issue 33883, 1 July 1975, Page 16

New superannuation scheme

Sir, — In what ways does Mr Muldoon’s scheme claim to resemble a superannuation scheme? No relationship between contributions and benefits; no lump sum if desired; premature death brings no provision for dependants; impossible to withdraw contributions; definitely compulsory, even for those who have opted to join a real superannuation scheme. Will they be able to afford both? There will certainly be no reductions in taxation levels. Without increased taxation will other services suffer to help pay Mr Muldoon’s grandiose way? Galloping inflation of a high level might help meet the bill. Is this what the National scheme is out to foster? What proportion of parents presently enjoy 80 per cent of an average wage for their exclusive use? Beware the family man. There will be less bread on the table if this goes through, and certainly no cake till you’re sixty, if you live that long. — Yours, etc., J. P. M. June 27, 1975.

Sir, — With respect to superannuation, Mr Douglas claims that the Natio-al scheme would discourage people from continuing employment beyond retirement. This implies that the Government scheme will not provide adequate benefits and continued employment will be necessary. He also claims that a 20-year-old earning $5200 now, would be worth $139,000 to his wife at 60. If wages increase at a rate of 10 per cent per annum, $5200 per annum becomes approx $235,000 per annum in 40 years. Who pays what? It is claimed that, under the Government scheme, for every dollar paid out only 10 to 20 cents represents the wage-earner’s contribution. If so, where does the rest come from? There are four possibilities: (1) Interest from Government bonds; (2) interest paid on local body loans; (3) dividends from shares and interest from loans to companies; (4) profits from property speculation. Mr Douglas also admits that his scheme will require the continuation of existing social security benefits. Therefore the cost to the wage earner will be the same if not more than the National alternative. — Yours, etc., A. D. MUIR. June 29, 1975.

Sir, — May I point out to : C. G. Marshall that through- 1 out history very few “social justice” laws have been introduced by Conservative (National) elements of the governing body of their own volition; these elements have had to be prodded, sometimes somewhat violently, The National Party in this country strongly opposed the introduction of social security and it seems somewhat strange that your correspondent should write of the “foresight of the National Party” in formulating a superannuation scheme which is after all an extension of social security measures. As C. G. Marshall well knows, the Leader of the Opposition is using Labour’s superannuation scheme as a “gimmick” in the political power-game he is playing, being somewhat at a loss to find anything constructive from within his own party’s ranks so is reduced to singing that old refrain — anything you can do I can do better. — Yours, etc J. HARKNESS. June 27, 1975. Sir, —Given that we New . Zealanders have no longer got the backbone to organise for our own retirement, and wish to employ the State to do it for us, I am convinced' that Mr Muldoon’s scheme isi quite fair. It is simple; enough to understand that a Government can only return to the people in the form of “benefits” their own tax contributions less all administration costs (including mismanagement costs). The most important fact in Mr Muldoon’s scheme, is surelyi

the immense savings in administration costs, as it replaces three pensions; quite a refeshing breeze after the complicated “bundle” we are experiencing. Oh that he could go one further, and promise a complete overhaul of our Public Service, which in simple dollars and cents terms, is more like a public disgrace. —Yours, etc., ANOTHER TAXPAYER. June 28, 1975. Sir, — Mr Muldoon’s superannuation scheme appears to have at least one anomaly. He claims no means test. Quote from “The Press” of June 25 “Women under 60 with husbands over 60, will receive the individual rate of national superannuation subject to an income test on both.” In most marriages, women are younger than their husbands. It would appear to be possible for a couple, husband compulsorily retired at 60, wife with some income, to be no better, perhaps worse off, until the wife reaches 60, than under the present system with its allowances for phone, travel etc. Today’s pension plus other income, gives a couple about $67 net weekly, without penalty as long as the husband is 60. Mr Muldoon’s scheme gives a couple $69.36 weekly, only if both are 60. — Yours, etc., READ THE SMALL PRINT. June 28, 1975.