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september Review News


This background paper provides a description of current retirement income policies in New Zealand.

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In September we ask: Who gets what?

In July the focus was on who pays for what? This month we review who gets what?

New Zealand Superannuation is under the review spotlight.  We are asking the hard questions about the eligibility criteria for the pension. Is 65 years the right age? Is the residency period of 10 years too short?

The rate of New Zealand Superannuation is linked to average wages, while all other benefits increases are based on inflation. Since 2008 the rate of super has increased by 34%, while inflation has increased by 11.2%. Is it time to rethink the index?

We are also reviewing deductions made to New Zealand Superannuation if people receive an overseas pension. This policy also applies to amounts exceeding the rate of super being deducted from their spouses.

Over the next 25 years the number of people aged over 65 will more than double, from 607,000 in 2013 to 1,285,000 in 2038. The cost of superannuation is also expected to double, reflecting the growth in numbers. Do you think the current setting should remain the same? Or does our policy need to change long-term?

Current NZS policy

New Zealand Superannuation (NZS) is a simple, universal pension paid to all who qualify on age and residency criteria. Its simplicity and universality mean it has a low administration cost in comparison to publicly-funded retirement schemes in many other countries.

Around 94 percent of New Zealanders over the age of 65 receive NZS or another social security benefit. For 40 percent of New Zealanders over 65, NZS provides virtually all their income.

NZS criteria

The New Zealand Superannuation and Retirement Income Act 2001 provides the legislative framework for NZS. To be eligible for NZS a person must:

  • be aged 65 years or older
  • be a New Zealand citizen or permanent resident
  • have been resident and present in New Zealand for not less than ten years since the age of 20, of which five years or more must be since the age of 50
  • be ordinarily resident in New Zealand

This Ministry of Social Development background paper provides a description of current retirement income policies in New Zealand. To download the full paper click here.