The Superannuation Game

There have been a couple of articles on the subject of superannuation this week, and it seems we are playing an age old game. At the moment this government is committed to leaving the superannuation age at 65. 15 months out from the next election, the articles questioning this position have started. By this time next year, it could well be a major election issue.

Both articles take an extreme position, deliberately. The idea is to start the ball rolling, and we are starting from the silliest position possible. Neither of these articles can possibly be taken seriously.

The first, published last Thursday, is from Janine Starks.

Pension: It’s like a Lotto win for Kiwis aged 65

Every Kiwi couple has a million-dollar gift waiting for them, but most of us are totally unaware of its high value.

To get our hands on it, all we have to do is turn 65 and last the distance in terms of life expectancy.

To make a million dollars out of the pension, both members of that couple would have to live to the age of 95. That is not impossible, but it is not very likely, even these days.

Ever stopped to think about how much it’s worth? Or how much you’d need to save yourself to replicate it? Many retirees trot out that well-worn yawn of having paid taxes all their life and they’ve earned it.

The financially transmitted disease of entitlement sets in. Most of us don’t come close to paying our way in the tax system.


I think you get the picture. She is trying to make out that the pension is some kind of amazing windfall that will make the old folks rich and that all superannuitants should be massively grateful to the younger generation for paying their taxes.

Boomers have paid their taxes; many still do. Why should they be grateful because young people are now doing what they are required to do by law? No one gets a choice about paying tax. There is nothing to be grateful for.

The implication behind her logic is that the pension is a bonus because we can all continue to work until we drop, which, of course, is ridiculous.

A significant number of people need a pension by the age of 65, or soon after. Many have been forced to retire early, because of ill health or redundancy. Many more retire before the age of 70, which proves that, as much as we would like to, we simply cannot go on working forever. Neither the physical nor mental capacity of a superannuitant is guaranteed once they reach 65. Those that can continue working are doing well, but it doesn’t work out that way for everyone.

There is another simple statistic that Ms Starks ignores. I was told by my bank manager about 5 years ago that over 95% of retirees will depend on the pension as their main source of income once they have stopped working.

Hardly like winning Lotto then, is it? A couple living on $633 a week, before tax, will not find life full of luxuries. This is the reason we hear of superannuitants afraid to turn on the heater, Janine – another statistic you have conveniently overlooked.

If that article was silly enough, the next one is just plain ludicrous, and it was written by Duncan Garner.

No-one will mess with the pension now … will they?

The pension right now is worth about $33,000 a year, almost $1300 a fortnight per couple or about $820 for a single person per fortnight. 

It’s a good little wage. Guaranteed until you die. Live until you’re 100 years young and sprightly and you’ll spend 35 years on taxpayer-funded superannuation. You’ll pull more than a million dollars as a couple. 

There are a number of common themes in these articles, which is why I believe that they are part of an agenda. There is that million dollars again if you both manage to live to 100. Chances are you won’t, but never let the truth get in the way of a good story, eh Duncan?

You will note that neither Janine Starks nor Duncan Garner has bothered to calculate how much a solo mother with 2 kids who never gets a job costs the taxpayer over her lifetime… and Starks has the nerve to imply that superannuitants don’t pay their way in taxes.

No wonder the baby boomers are spoilt for choice. They’re struggling to spend their riches. Lucky generation, not that they ever admit it. Typical. Moaners. They had it so hard. Those jobs for life, those without qualifications running the bank, the council and the government.

Then there are those that worked as mechanics, panel beaters, builders, farmers, joiners, plumbers, electricians, painters, chefs, nurses, cleaners… not all baby boomers had office jobs. Many of them are pretty worn out physically by 65.

But bugger it, on National Super I’ve signed up with the baby boomers. Keep it as is. If it bankrupts us, well, someone will sort it out. Won’t they? 

Yes, I’ve changed my mind purely on selfish, self-interest grounds. Yes, we’re living longer, yes, it’s expensive and by the time I’m retired the average life expectancy will be close on 89.


Hmmm. These two, working in tandem, should get their facts straight. Ms Starks says that life expectancy is now 89 years. I didn’t believe that, and it seems that I was right.

If this is Duncan Garner’s attempt at humour, I suggest he doesn’t give up his day job. It is not that at all, of course. It is no coincidence that two articles, saying pretty much the same thing, are published by the same media outlet 3 days apart. The question of raising the superannuation entitlement age is now on the agenda again and will be an election issue next year. Starks and Garner have spoken.

Now tell me again that the media do not control the narrative here?