Briefing Notes

Briefing Note 21- KiwiSaver: Another lesson from New Zealand?

KiwiSaver is designed to get people into the habit of saving. New Zealand and the UK have different retirement income issues. New Zealand does not have the income inequality, means-testing or complexity concerns of the UK. In New Zealand there is no evidence of widespread ‘undersaving’, but some concern that the retirement income outlook for young people is unclear. Work-based savings schemes have caught the attention of policy makers as cost effective ways to help New Zealanders overcome any procrastination to save.

This Briefing Note looks at a simple new policy of automatic enrolment which was announced in New Zealand in May 2005. This might provide some ideas for the current UK savings debate.