It commits to boost KiwiSaver choice and cut red tape
The National Party says it will provide KiwiSavers with more freedom and choice over where they invest, as well as ridding borrowers and lenders of financial red tape.
In a statement, Andrew Bayly, National’s commerce and consumer affairs spokesperson, said National aimed to boost economic investment, by allowing KiwiSavers to invest in more than one provider, to drive innovation, boost competition, and put downward pressure on fees; as well as cut financial red tape that Bayly said is stifling investment, including the CCCFA.
“The money in every KiwiSaver account belongs to the person who saved it – but the current rules mean Kiwis have to have all their KiwiSaver savings with just one provider,” Bayly said. “That restriction is limiting investment choices, and potential returns, for savers.”
“As the sector grows and matures, some KiwiSaver providers are looking to diversify their investments into different classes of assets – such as start-ups and build-to-rent investments. However, under the current settings, savers who want to access these new investments are forced to shift all their savings to that provider – limiting choice and competition.”
He said that despite the increasingly important role KiwiSaver plays in the New Zealand investment environment, restrictions on savers and fund managers were pushing up fees and limiting investment opportunities.
“Increasing flexibility and choice for KiwiSavers to allocate their savings across multiple providers will encourage innovation, and higher potential returns over their lifetime,” Bayly said. “That’s why National will give KiwiSavers the flexibility to split their savings across multiple providers to provide more choice, improve investment options and competition. Improving competition is the best way to put downward pressure on KiwiSaver fees.
National also vowed to scrap some of the financial red tape introduced by the Labour government “which has proven unworkable,” including the CCCFA, which according to Bayly, “has stifled access to credit and resulted in borrowers being subjected to highly intrusive questioning from their bank.”
“Someone looking to start a business by extending their mortgage shouldn’t have to tell their bank which brand of cat food they buy or justify their Netflix subscription,” he said. “National will maintain tight restrictions on predatory lenders, but significantly reduce the scope of Labour’s other changes to the CCCFA.
National said it will also repeal the recent Conduct of Financial Institutions Act, which it claimed would make credit more expensive and harder to obtain, even for basic services such as overdrafts and mortgages.
“Cutting financial red tape and unlocking the enormous potential of KiwiSaver is part of National’s broader plan to strengthen the economy so we can reduce the cost of living, lift incomes for all, and deliver the public services New Zealanders deserve,” Bayly said.
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