New National Party policy will let young people use KiwiSaver to pay bond; experts hate it

Public Policy / news

A new National Party policy that would let young people use KiwiSaver to pay rental agreement bonds is a ‘stop-gap’ measure that dilutes the scheme, experts say

17th Jul 23, 3:40pm by Dan Brunskill

The National Party has promised to allow people under 30 to use KiwiSaver money to make bond payments on tenancy agreements, if elected in October.

Chris Bishop, National’s housing spokesperson, said it was an idea pitched by the party’s youth wing as a way to make it easier for students to get into flats.

Renters would be able to transfer money from their Kiwisaver account to Tenancy Services and back again when the tenancy ends.

“It sits alongside National's other common sense tenancy law changes to make it easier for renters to get ahead," he said.

But financial capability experts have criticised the policy, warning it detracts from the key purpose of KiwiSaver — which is to build wealth to use in retirement.

Susan St John, an honorary associate professor at Auckland University’s business school, said the policy was “stop-gap, short-termism”.

“We don't want to see the balances of KiwiSaver used for different purposes [other than retirement],” she said.

While some people did desperately need money for housing, prompting them to raid their retirement savings was not a proper policy fix.

People in material hardship already had a mechanism to access Kiwisaver funds, and those who aren’t shouldn’t use retirement savings for a bond.

Bishop said the policy would only apply to people aged under 30, and could only be used a total of five times.

“This reflects the fact that we want young people joining KiwiSaver early and staying in for the long haul,” he said in a statement.

The bond payment for a room in a shared flat might be about $1,000 in major cities. The average KiwiSaver balance for a person aged 18-25 was approximately $7,500 in 2022, and $15,000 for ages 25-30.

‘Absolute last resort’

Ruth Smithers, chief executive of financial mentoring service FinCap, said people who were unable to pull together a bond may be able to get support through WINZ.

“FinCap generally sees accessing KiwiSaver early as being an absolute last resort. We encourage anyone considering early access of KiwiSaver to contact a financial mentor and see if there are other options,” she said.

FinCap is an NGO that receives funding from the Ministry of Social Development to run the MoneyTalks helpline.

David Boyle, head of sales and marketing at Mint Asset Management, said he was concerned that politicians saw Kiwisaver as a “little pot of gold” that could be used to tackle specific problems.

He said it was good that the money moved directly from the Kiwisaver account to Tenancy Services, as that significantly increased the likelihood it would not be lost.

But still, young people’s retirement savings may end up being spent repairing a house they don’t even own.

Boyle, who previously worked for the Financial Capability Commission, said it was important to build up a cash savings fund before investing into Kiwisaver, which is for long-term savings.

“The best thing about Kiwisaver is that it is reasonably simplistic and if you continue to overcomplicate it, it dilutes its original proposition,” he said.

“If you keep tweaking around the edges, it becomes something that it wasn't designed to be in the first place — which then creates other challenges down the road”.

Kiwisaver providers already spend significant amounts of money managing the material hardship exemption, and adding more complications will add to fees across the scheme.

If National were elected, it would amend the KiwiSaver Act to add the new policy and would also do any work required to make back-end operations between Tenancy Services and KiwiSaver providers as easy as possible.

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159 Comments

by Von Metternich | 17th Jul 23, 3:48pm 1689565690

What a ridiculous marginal policy that wastes retirement savings of the young to encourage them to leave home and rent for exorbitant rates (to save the investor class)

No one should vote for the Nats when they are this incompetent at policy formation after six years out of office.

by JohnTrz | 17th Jul 23, 3:56pm 1689566175

The real rot for KiwiSaver began in 2014 when savers became allowed to withdraw the state subsidy, the so-called 'tax-credit', to finance a deposit on a first home.

https://www.taxtechnical.ird.govt.nz/en/new-legislation/act-articles/ta…

State subsidy of KiwiSaver should cease. KiwiSaver should be a managed-fund private investment involving only the saver and his or her employer.

And all managed funds ought to be taxed at the saver's ordinary marginal rate.

by Pragmatist | 17th Jul 23, 4:16pm 1689567362

Kiwisaver should not be taxed at all, its taken from after tax income, and as an incentive for locking it away to save and prepare for your own retirement it should not be taxed on its investment returns as it is now.

by JimboJones | 17th Jul 23, 4:30pm 1689568226

So the more money you have in kiwisaver, the more tax free profit you can make? Give to the rich and take from the poor?

by Pragmatist | 17th Jul 23, 4:36pm 1689568564

It's not taking from the poor. Quit talking nonsense Jimmy-jams.

by JimboJones | 17th Jul 23, 6:33pm 1689575598

I guess you could also argue taking the tax off luxury cars isn’t taking from the poor, but someone has to make up that missing money. It certainly wouldn’t be fair.

by Pragmatist | 17th Jul 23, 6:43pm 1689576218

What tax off luxury cars are you talking about Jimbo? Your logic is.. Illogical.

by Ty Coch | 18th Jul 23, 9:18am 1689628731

Maybe Teslas, where the rebate taken off is about the same as the GST put on.

by Pragmatist | 18th Jul 23, 12:08pm 1689638891

you mean the rebate, which isn't a tax cut, and is paid for by people buying mostly new dirty rangers and hiluxes, not the poor?

by Flying high | 17th Jul 23, 5:16pm 1689570998

Give to the spenders so they can spend some more while the savers should suck it up and learn to work harder

by huttman | 17th Jul 23, 4:43pm 1689569009

actually, employee contribution are not taxed, only the employer contribution are taxed before put in kiwisaver.

by Pragmatist | 17th Jul 23, 4:48pm 1689569317

Suggest you have a read of a payslip again, your tax is calculated on your full income, before KS contribution is deducted.

by K.W. | 17th Jul 23, 6:24pm 1689575075

Lets adopt the Australian superannuation system. Compulsory contributions are not taxed on entry, concessional tax rates applied on earnings (15%), and tax free on withdrawals after 60. The Kiwisaver system is nothing more than a normal savings account - no wonder the politicians treat it as such.

And you can use a superannuation fund to buy residential investment property, with a non-recourse mortgage.

by Pragmatist | 17th Jul 23, 6:40pm 1689576048

I was with you up to that last bit.

by K.W. | 18th Jul 23, 1:06pm 1689642360

Yes, if you thought that New Zealanders were property obsessed, you havent lived in Australia! NACT know that their voting base is currently packing their bags for warmer and more property friendly climes. Unfortunately they all happen to be the same 50% of voters that pay all the income tax.

by Nzdan | 18th Jul 23, 1:10pm 1689642638

As a net tax payer, I don't begrudge those who are non-net tax payers. They still pay income tax, but for whatever reason their rent is so high that us productive taxpayers must provide them with tax subsidies to make the numbers work for other people's lazy investments.

by E46 | 18th Jul 23, 6:41pm 1689662515

Also the argument around "net tax payers" has zero nuance to it and people keep parroting it without looking into where it actually came from.

Bringing up "50% of New Zealander's aren't net taxpayers" but forgetting that part of those 50% percent are people on superannuation. It's talked about as if 50 percent of workers are contributing nothing but considering there are 842,000 over 65's who will be the ones collecting the vast majority of those "transfers".

Then another big chunk would be WFF, and accommodation supplement which is basically a landlord subsidy, then the classic jobseeker which is $3b out of a $50b budget. There aren't as many working-age people just sitting around doing nothing as it seems to be framed from looking at the data.

The info for that is all in the below link showing what the transfers actually are and what groups are getting what. That data is also a bit out of date as it's from 2018. Considering the tax brackets haven't been adjusted for inflation any time recently we may more net tax payers than we did previously.

https://taxworkinggroup.govt.nz/sites/default/files/2018-09/twg-bg-distributional-analysis.pdf

by imhenry | 18th Jul 23, 4:23pm 1689654211

How about not paying tax until the funds are with drawn at age 65. Balance of Kiwi Saver benefit overtime from yearly accruals

by Flying high | 17th Jul 23, 4:56pm 1689569787

Rentiers will luv it

This policy will be gone by lunchtime if they are just out seeing how it flies

by WellingtonInvestor | 17th Jul 23, 4:36pm 1689568577

Another policy to support landlords and the property market. Allows rents to increase without the increased bonds being much of an issue. This feels a bit like the first home withdrawal, but for renters. But making these sorts of changes to kiwisaver really erodes kiwisavers intentions and means less savings in retirement

But don't forget that this is somewhat of a distraction , beucause for most under 50, the Kiwisaver withdrawal age will increase to 67 under national. This is becuase they are increasing the Super age for most under 50, and Kiwisaver withdrawal age is tied to the super elibility age. They need to decouple it so people have a choice to retire early at 65 and use their kiwisaver. Otherwise people have 2 less years to use the money

by kiwimm | 18th Jul 23, 9:12am 1689628324

There are no advantages to put money in Kiwisaver above the employer match or $1042 (whichever is higher). If you want to retire early then invest your additional money outside of Kiwisaver where you can choose what you do with it.

by WellingtonInvestor | 18th Jul 23, 2:37pm 1689647847

Yes to a degree. But it does stop people withdrawing money early for other things, as many people don't have self control when it comes to money. If you put the money into an ETF or index fund etc, you can get that money at any time.

by powerupkiwi | 17th Jul 23, 7:27pm 1689578862

It’s their money. If they want to temporarily forgo fairly minimal investment returns in order to avoid being financially crippled for weeks, then let them. It’s probably just going to come from student living costs or a short term loan anyway.

Are you suggesting everyone just live with their parents until they have a house deposit? (only loser Aucklanders do this)

by CN - new | 18th Jul 23, 10:29am 1689632988

"What a ridiculous marginal policy that wastes retirement savings of the young to encourage them to leave home and rent for exorbitant rates"

Two questions to ponder:

1) does this policy help the long term financial futures and retirement of the younger voters?

2) does this policy help to attract votes of the younger voters in an upcoming popularity contest?

by JimboJones | 17th Jul 23, 3:48pm 1689565719

We are getting to the part of the election where National has to actually tell us their policies. That might not go so well for them...

by Noncents | 17th Jul 23, 4:23pm 1689567806

At this stage it appears all parties are playing tag, and none of them want to be in.

by Pragmatist | 17th Jul 23, 4:46pm 1689569161

Not surprising, the infrastructure of the country is in a henious state of disrepair, and a serious breakdown is imminent. Who wants to be the on-shift serviceman when that happens.

by Pragmatist | 17th Jul 23, 3:50pm 1689565854

Is that the fading echo of "Hold my beer and watch this" I hear?

by Yvil | 17th Jul 23, 3:51pm 1689565901

Bad idea.

by kiwikidsnz | 17th Jul 23, 5:26pm 1689571599

Yep. Nationals groupthink policy silo on full display.

by Flying high | 17th Jul 23, 3:53pm 1689565988

Dumb and dumber

by Beanie | 17th Jul 23, 7:07pm 1689577643

You are describing National and ACT there. Check out ACT's policy to rent our hospitals from foreign landlords.

This from their website:

"Private provision and leaseback of public hospitals

ACT will:

Allow lease-back and build arrangements with large, reputable global infrastructure investment groups for the refurbishment of existing public healthcare infrastructure and the construction of new facilities."

by Beanie | 17th Jul 23, 7:36pm 1689579377

Can one of the many ACT fanboys on here explain why renting our core infrastructure is such a good idea?

I haven't yet ruled out voting for them but Jesus they have a tray of dead rats I would need to swallow.

by HSL | 18th Jul 23, 7:31am 1689622271

Depends on the situation but it can pay off - not sure I agree with it mind. Maybe reducing the risk of being stuck with a building that fails earthquake requirements and the like.

by K.W. | 18th Jul 23, 12:56pm 1689641802

Because they recognise that NZ doesnt have the money to build new hospitals, so you get someone else to build them for us and then the Govt rents them. Otherwise a lot more tax is going to need to be raised.

by Nzdan | 18th Jul 23, 1:14pm 1689642850

Agreed. I don't like the idea of renting out our hospitals, but as you say unless we can find the $500m or so each to replace our aging hospitals then what can we do?

Coincidentally, our biggest social welfare bill has increased by 1 hospital per year since 2004 for which today it's now 36 hospitals per year and those recipients are the most likely to be needing said hospitals. It would be a cruel irony if they complained about the quality of health services.

by Hamish | 18th Jul 23, 2:57pm 1689649024

If we can't afford to build our own hospitals for our own resident taxpayers (and the odd sick or injured visitor), then we definitely have bigger problems.

Then again, we built distribution networks so I guess that's the same right?

Someone else can make a margin of the rental.

by HouseMouse | 17th Jul 23, 7:50pm 1689580205

Oh gawwwwwd

by blobbles | 17th Jul 23, 3:55pm 1689566140

Pretty disgusting move. "We know housing is f$%%ed, we helped to destroy it. So what we will do is make it easier for the people who are worst affected by our collective incompetence, to be more f%#&ed down the road".

Wouldn't expect anything less from the tobacco salesman.

by Flying high | 17th Jul 23, 4:03pm 1689566602

The idea and motivation for saving is f$%%ed if KSS is the only thing we do

by J.C. | 17th Jul 23, 4:06pm 1689566804

Wouldn't expect anything less from the tobacco salesman.

FMCG. 400 different brands.

Anyway, if you can success with Phillip Morris or BAT in sales, you probably know a few tricks.

by Frank Sobotka | 17th Jul 23, 6:47pm 1689576436

If he was a success there he wouldn’t be in politics with his cheap ill fitting hallensteins suits.

Selling drugs to addicts doesn’t take any great trick either.

by Chris-M | 18th Jul 23, 11:53am 1689637992

This National Party are only there for one thing. That is to enrich the wealthy speculative investing classes. Their support for industry and other employers is very secondary. At the end of the day, it is the productive economy that has to pay for all this speculative asset growth and the social consequences. It really is time that a few captains of industry spoke out against this asset speculation mania.

Their accusations of conflicts of interest in respect of the Labor MPs, while justified, pale into insignificance when compared with how they are going to outrageously enrich themselves.

Their first priorities are :

Do away with the top tax rate changes to put more money in the pockets of the super wealthy

Restore the property investment interest tax deductibility to put more money in the pockets of property investors

Flood the country with immigrants to make labor cheap and boost property values

Remove protection for house tenants to put more money in the pockets of investors.

All their other statements are just window dressing to get them into power, pretty shallow and unlikely to come to anything.

The best thing that young kiwis can do is leave the country. In the unlikely event that labor get back in,they are not much better.

If you can be bothered voting, vote TOP

by powerupkiwi | 17th Jul 23, 7:34pm 1689579291

TOP is a way better vote. But immigrants don’t make labour cheap. And they wouldn’t raise property values if we weren’t kneecaping our economy with restrictive zoning

by Jonny.Foe | 17th Jul 23, 4:02pm 1689566531

What is going on? This election campaign is fast becoming 'dumb and dumber'. Where are the policies that actually address the challenges we face? Whether you agree with the Greens or not, at least they have a costed policy that would dramatically reduce child poverty rates. When are the main parties going to put anything real on the table?

by interesting1234 | 17th Jul 23, 4:21pm 1689567676

Simple, there's not the money in the coffers to play with so they are frantically trying to get people to use their own money for political votes. People keep saying Nat/Act will win the election, I'd say Act will get more of the National voters after the boys in blue come out with this rubbish.

by Jonny.Foe | 17th Jul 23, 4:44pm 1689569058

There is plenty of money in the coffers. NZ is one of a handful of countries to have a net surplus rather than a net debt, and one of maybe two that manage this despite having a trade deficit. Both parties are choosing to play the austerity game.

by huttman | 17th Jul 23, 4:46pm 1689569204

are you sure their policy will address child poverty issues? how much better off for those poor kids if their only hope is living on the dole?

by Jonny.Foe | 17th Jul 23, 4:55pm 1689569713

We rely on having 100,000 to 150,000 people on the dole and another 200,000 people wanting more work to 'control inflation'. The least we can do is make sure this involuntary army get enough money to feed themselves and their kids.

by kiwikidsnz | 17th Jul 23, 5:20pm 1689571241

Perhaps the Greens could also explain how its gping to be mathematically possible to drastically reduce child poverty rates when the methodology is "Percentage of children living in households with less than 50% median equivalised disposable household income before housing costs are deducted."

The poor are always with us - in a normal distribution curve. Unless children are going to be limited to the half of households who are net taxpayers.

by Jonny.Foe | 17th Jul 23, 5:29pm 1689571752

Finland figures for the relative income child poverty measure is below 5%. It is quite possible - you just have to be prepared to use the tax system to really reduce inequalities. In 1950, the average working kiwi family man paid literally nothing in income tax for example. Poverty is predominantly a political choice.

by kiwikidsnz | 17th Jul 23, 5:37pm 1689572263

In the modern Western world child poverty is predominantly a parent choice.

by agnostium | 17th Jul 23, 7:30pm 1689579016

You're wrong but let's pretend you're right.

Should kids be penalised for their parents choices?

by kiwikidsnz | 17th Jul 23, 9:17pm 1689585476

The definition of moral hazard.

by agnostium | 18th Jul 23, 2:15am 1689603322

No, that isn't the definition of moral hazard. So again, should kids be penalised for their parents choices?

by kiwikidsnz | 18th Jul 23, 3:01pm 1689649269

moral hazard

noun:

lack of incentive to guard against risk where one is protected from its consequences,

Your strawman distractions notwithstanding, having kids is a personal choice that comes with personal responsibility.

by kiwikidsnz | 17th Jul 23, 9:34pm 1689586441

My parents & grandparents who were average working kiwi families in 1950 say you're wrong - any evidence for your assertion ?

"...use the tax system to really reduce inequalities." In effect this is the minority of net taxpayers increasing the wealth of people with children to the point where their incomes are equivalent to net taxpayers. Why should others subsidise their personal choices when the worlds population is now 3x that of 1945.

by Jonny.Foe | 18th Jul 23, 8:04am 1689624285

Come on, you know I don't make stuff up: https://teara.govt.nz/en/taxes/page-4

by malamah | 18th Jul 23, 9:42am 1689630133

57% for ‘unearned income’

Well, damn.

by Jonny.Foe | 18th Jul 23, 10:27am 1689632825

hell , yeah!

by Hamish | 18th Jul 23, 10:38am 1689633537

Does anyone else think this might encourage some productivity?

by kiwikidsnz | 18th Jul 23, 2:53pm 1689648822

"When the Labour government left office in 1949 the top income tax rate was 76.5%. "

However I acknowledge that "the butcher with 2 kids" was doing well - similar to todays half of households paying no net income tax after credits eg WFF

by FCM | 17th Jul 23, 4:04pm 1689566687

I've always though that since you let people take a % out for a first house, why not let other people take a % out to pay off their mortgage if they need too (has to go direct to mortgage lender). Both form a part of the retirement plan for a person, can't see why you let one demographic take it out and not another.

by WellingtonInvestor | 17th Jul 23, 5:04pm 1689570242

Beucase they are the same people, but double dipping. First home buyers are also mortgage holders. IMO kiwisaver shold never have been allowed to be used for a first home. All it did was push up house prices even more as people could afford to pay more, as they didn't have to save manually to get their full deposit. I used kiwisaver myself for a first home, only because it allowed me to and it benefited me at the time to do so. But not using it wouldn't have prevented me buying the first home. But I will have less savings in my kiwisaver at retirement as a result.

Why not allow people to take out kiwisavers for health reason, such as an operation or essential drugs. Or IVF if they can't have children. It seems crazy that property in NZ gets treated so favourably above everything else in NZ

by HughJorgan | 17th Jul 23, 4:08pm 1689566895

Another policy trying to please their investment property owner voting base.

It is getting too hard to vote for them!

by Frank Sobotka | 17th Jul 23, 6:49pm 1689576593

And labour are the same.

TOP on the rise

by JohnfromtheTron | 17th Jul 23, 7:20pm 1689578406

Yep...up 100% to 2% in the latest poll !!!

by Frank Sobotka | 17th Jul 23, 10:13pm 1689588810

Momentum is everything

by Uncle Bulgaria | 18th Jul 23, 4:59pm 1689656361

Sorry about Ziggy, Frank.

by Uh Oh | 17th Jul 23, 4:08pm 1689566914

Just a poorly thought out policy.... period. Buy a house - yes, use as security for renting - no.

by agnostium | 17th Jul 23, 4:10pm 1689567031

I've said it before and I'll say it again. Luxon is the worse National leader in living memory. He's a disgrace to the core values of the original National party.

by Chris-M | 17th Jul 23, 5:01pm 1689570111

He reflects Nationals values transparently. That is his problem, he is not smart enough to put on the act required to con voters to put National into power and screw the general public. Key was equally despicable, he just had the smooth veneer to pull it off.

And if that is not enough to put you off, he is not a very nice person.

"you are just a trolley dolly"

"you are just bottom feeders"

he is a very devout MAGA cap wearing christian

He has lots of rental properties

"here is my publicity posting from Te Puke" (while actually in Hawaii)

He needed a Mercedes to drive him across the road to parliament!!!!

Very hard to find any redeeming features.

If they wanted to replace him, they would struggle to do better. They have all been well selected to reflect Nationals values and cut from the same cloth.

by Noncents | 17th Jul 23, 4:24pm 1689567857

"Luxon is the worse National leader in living memory."

Collins would beg to differ.

by agnostium | 17th Jul 23, 7:32pm 1689579136

Nope, while not a shining star by any measure, she was 100% better than Luxon.

by powerupkiwi | 17th Jul 23, 7:40pm 1689579616

He’s threatening to lose against the least competent govt since Muldoon. If they’d kept Bridges, this’d be a done deal.

by Albert2020 | 17th Jul 23, 4:12pm 1689567173

Atrocious policy. Yet another short sighted and blatant attempt to subsidize the real estate sector. If this is the quality of their published policy then god help us what they will introduce after the election should they win come October. Little wonder the minor parties are doing so well in the polls.

by Mr Frank | 17th Jul 23, 4:17pm 1689567422

Great idea.

Pragmatic. Well done National.

by malamah | 17th Jul 23, 4:19pm 1689567588

/sarc

by Mr Frank | 17th Jul 23, 5:11pm 1689570697

/unsarc

by WellingtonInvestor | 17th Jul 23, 5:11pm 1689570663

If I was a landlord or property investor, and didn't really care about NZ as a whole, and was only looking after my own interests, I would agree with you.

by kpnuts | 17th Jul 23, 4:34pm 1689568440

Gimmiky -- but if it has to be returned -- not that tragic! more to the ;point -- how about opening the scheme up for divorcing couples needing to buy a second home! Trying to buy to avoid having to sell the family home -- and cant access it -- and the property i tried to buy - -similar issue that one half wants to sell the other needs to keep it and stay -- might make sense to look at all the scheme for ts functionality and not just a tiny part of it

by M0ralHazard | 18th Jul 23, 10:31am 1689633064

It doesn't have to be returned if the property is damaged. It would be interesting to see what percentage of people under 30 get their full bond back each time. Plus it is removing ~$1000 from your $7500 savings for up to a decade if you start renting in your early 20s. It is earning no returns in that time and is losing ground to inflation

by huttman | 17th Jul 23, 4:37pm 1689568656

using kiwisaver as bond money for rentals is a very bad idea. Kiwisaver is a way to save, and it's especially important for young starters to learn habit of saving.

I sympathize people who is in bad financial situation. I'd rather MSD give 6 months interest free loan towards bond payments. of course it'll be loan, not give away, it would work like a BNPL.

by Kate | 17th Jul 23, 4:39pm 1689568793

They already do - see link below.

by malamah | 17th Jul 23, 4:40pm 1689568811

We can't keep subsidising the rentier class. This is another attempt to provide a socialised "floor" under rentals. Let it be a free market and we'll see how many jump ship.

by Kate | 17th Jul 23, 4:39pm 1689568747

Yesterday it was potholes, today it's rental bonds. They really are addressing the pressing issues.

Bet the intent is really to get rid of this option;

https://www.workandincome.govt.nz/housing/move-house/bond.html

by Noncents | 17th Jul 23, 4:51pm 1689569505

I personally believe Potholes are a pressing issue. We are spending (Wasting) Billions on Roads every year. Yet our roads are failing everywhere. There are temporary fixes, workarounds, not to mention shoddy design, poor construction, and minimal maintenance.

The roads here in Taranaki are literally disintegrating. Another 10 years, and the airport (Assuming the runway isn't as shoddy) will be the only method in or out of New Plymouth.

NZ has proven incompetent at any sort of public transport - particularly rail. So it won't matter how many EVs we have or buses we get, we still need roads.

by WellingtonInvestor | 17th Jul 23, 5:08pm 1689570519

My understanding is that the material they are using on the roads and for repairing wear, is now imported and inferior to what they were previously using. So it is contributing to these problems.

by powerdownkiwi | 17th Jul 23, 7:13pm 1689578020

WI - I suspect you'd get a lot out of reading Tainter's Collapse of Complex Societies. It takes more and more net energy just to maintain, and eventually you don't.

by Ahuhyeah | 17th Jul 23, 8:05pm 1689581158

Upped the max weight of trucks a few years back. That will be coming home to roost too.

It's harder amd more expensive to do road works as traffic volumes and health and safety requirements increase so getting less value out of same budgets.

Maybe a little search to see if the companies doing the work are declaring record profits too.... take a small bet they are...

by U4Mism | 18th Jul 23, 10:32am 1689633172

Exactly this, National upped the limit to 53 tonnes from 44, extended lengths etc etc, all in the name of "getting the country moving" now it comes home to roost that it really destroys the roads we build (I'd imagine not helped by the extreme weather we've had of late) and they make a song and dance out of paying for patching it all up again. Freight should be on the railways, weight limit on roads reduced back down to help stop this destruction, maybe with road charges for freight companies that better reflect their actual, physical, toll on the roading system.

I fail to see how repeating archaic answers to try to re-solve old problems while taking from the future in the name of profit will help us navigate to a better place. Some adult, joined-up thinking is needed across the globe and NZ should be a great place to show the way. Enabling polluters, extractors and extorters to carry on pursuing the same course of action that has delivered us here is not exactly something to be proud of.

As Richard Prior pointed out, 'None of the Above' should be an option at the bottom of the ballot paper.

by WellingtonInvestor | 18th Jul 23, 2:39pm 1689647970

Interesting. Not seen that mentioned in the mainstream media alongside these stories on potholes.

by rastus1 | 18th Jul 23, 8:50am 1689627004

Repairing a pot hole is like repairing a warn out shirt. Works for a while on the odd rip....but I suspect these are totally warn out shirts.

by agnostium | 17th Jul 23, 7:35pm 1689579347

The reason why the roads are disintegrating is because it is super expensive to maintain them and only getting more expensive to do so and people want a car based transport system but do not want to pay for it. Hence all the hidden subsidies to cars. The issue is these hidden subsidies are also now running out of options.

by WellingtonInvestor | 17th Jul 23, 5:06pm 1689570404

The cynic in me thinks that that could be the case. They are looking at ways to cut costs. Although not everyone under 30 is in kiwisaver, many will opt out or not worked, so never got automatically signed up..

by Noncents | 17th Jul 23, 4:41pm 1689568866

Really we should acknowledge the Elephant in the room. Kiwisaver is likely a problem for more people, than it is, a solution.

For many (slowly tipping towards most) saving for tomorrow is simply a luxury they cannot afford.

The concept of "retirement" is relatively modern. WHen I run the maths, retirement in the current state looks unlikely.

So if I am going to work until I die anyway, I might as well have that 3% now.

by danicriss | 17th Jul 23, 6:12pm 1689574376

Anyone sharing your view simply has the option to not contribute at all to KiwiSaver. Why do you state it's a problem when it can be simply ignored?

by Hastings | 17th Jul 23, 4:43pm 1689569013

Pothole repairs and now this…inspiring stuff not. Surely they must be preparing to roll their so called leader before it’s too late.

by Mr Frank | 17th Jul 23, 5:12pm 1689570749

Consider these silly issues have been ignored by Labour.

by JimboJones | 17th Jul 23, 6:38pm 1689575902

Are you saying potholes are not being fixed because of the government? Does the prime minister have to approve each repair or something?

by agnostium | 17th Jul 23, 7:38pm 1689579481

Most roads are the responsibility of local council's anyway. And they hate raising rates enough to cover the cost of maintaining roads. Most potholes have nothing to do with central government.

by Nzdan | 18th Jul 23, 8:54am 1689627272

And even then, the Government claims to have fixed 54,544 potholes in 2022. 150 per day.

“To be clear, Waka Kotahi is fixing a record number of potholes across the state highway network. It repaired 54,544 potholes in calendar 2022, compared with 39,652 in 2018.

https://www.beehive.govt.nz/release/national-finally-owns-pothole-probl…

by K.W. | 18th Jul 23, 12:51pm 1689641518

They fix them, and two weeks later its a pothole again. Waka Kotahi stands for "Government Make Work Scheme". Do it properly the first time. Start by buying some decent bitumen instead of the cheapest rubbish they can find because they don't to admit that allowing Marsden Point to close was a colossal and expensive mistake. See also jet fuel. And CO2.

by Nzdan | 18th Jul 23, 1:18pm 1689643129

Who buys the bitumen? Is it Waka Kotahi, or Fulton Hogan/Higgens/Downer etc?

In September last year they published a new "Asphalt Binders" spec, because presumably one never existed. I imagine it may take some time for this to filter through? It appears to be fairly comprehensive, but I'm not an expert in roading. Since you're knowledgeable, maybe you can give us a run down on what's wrong with this spec.

https://www.nzta.govt.nz/resources/asphalt-binders/

by Final Account | 18th Jul 23, 1:00pm 1689642042

Doesn't government legislate the truck size allowed on the roads?

by printer8 | 17th Jul 23, 5:03pm 1689570202

Those under 30 can apply 5 times.

Really? Sad indictment that some are likely to loose their refundable bonds multiple times.

by KH | 17th Jul 23, 5:10pm 1689570658

When I first heard this I thought it so bad and loopy it had to be the Greens. Too bad even for Labour.

But turns out to be the Nats. !!!

OMG

(reposted from the 4pm news)

by K.W. | 17th Jul 23, 6:30pm 1689575444

Funny, so did I lol

by 21Trillion | 17th Jul 23, 5:30pm 1689571820

Why can't we admit that our property market is unaffordable and killing the futures of younger generations?

Stop trying to work around the issue at all costs and address it from the top down. Tax property like all other assets and apply borrowing rates like you would for any other asset class.

What a fu**ing joke of a country this is.

by dumbthoughts | 17th Jul 23, 5:35pm 1689572137

It’s like somebody in National woke up and said “what one policy could we come up with to most piss off the Interest.co.nz comment section”

I disagree with the policy as effectively it’s a way of subsidising overpriced rentals (as having bond money is a blocker) but at the same time if I cast my mind back to my renting days I can think of at least a couple of scenarios in which this would have been very helpful - at an individual level of course and not a wider societal level.

for example when flat hunting at uni there was always one flat mate who could never come up with bond money - would be useful in that circumstance.

With respect to landlords withholding the bond I never had that happen to me once in about 7 different tenancies over a decade BUT I know some take the piss … at the very least you’d need to make it all but impossible for the landlord to withhold the bond.

Between Labour deciding that being tough on youth crime does work (when it’s the right Chris announcing the policy), the Greens basically wanting to rip up the playbook on private property in their quest for justice (unless you actually believe the “non binding” bit, now buy my bridge) and National coming in to bat yet again for the landlords it’s a great day to have little faith in the quality of NZ politicians.

by sparrow | 17th Jul 23, 5:48pm 1689572930

The whole idea of a retirement fund is that it can't be touched, it works away while compounding interest does it's magic. The longer the money is in, the better.

Fleecing youngsters of their retirement savings is a despicable idea.

by powerdownkiwi | 17th Jul 23, 7:19pm 1689578398

Sparrow - try thinking about what the money will buy, not how much proxy they will have. If there's nothing on the shelves, the 'money' is worth squat.

And that is what is happening; ever-less planet remaining (it's all we make stuff out of0, ever less fossil energy remaining, ever-more pollutive impacts - but coumpound interest will work its magic for them?

Spare me.

by Retail shop | 18th Jul 23, 8:22am 1689625374

🥱 yawn, I better get up and go and sell some more plastic trinkets.

by JimboJones | 17th Jul 23, 6:43pm 1689576215

And if you need a car for uni, dip into KiwiSaver? Then your car needs repairs, another dip? The number of helpful scenarios are almost endless, until you eventually become helpless.

by dumbthoughts | 17th Jul 23, 7:49pm 1689580161

Funnily enough, it was actually a case of major unexpected car repairs coming in at the same time as shifting into a new place (with that weird crossover where you haven't got your old bond back yet) that put me in a tricky spot back in my uni days.

by WellingtonInvestor | 17th Jul 23, 11:28pm 1689593287

Or someone needs their impacted wisdom teeth removing and need $4000. Or need IVF as a last chance to have children. IMO these examples are a far more valid reason for an early kiwisaver withdrawal , than paying for a bond for a rental. Especially as you can already get a grant for a bond at https://www.workandincome.govt.nz/housing/move-house/bond.html  

by JohnfromtheTron | 17th Jul 23, 7:23pm 1689578589

I'm guessing it's a ploy to get young people to sign up to Kiwisaver.

by Hamish | 17th Jul 23, 5:36pm 1689572167

Experts hate it?

I f%&kn hate it!!!!

by Gracey | 17th Jul 23, 5:44pm 1689572679

Taking the retirement plan from the under 30's. Stay classy. (Sarc)

by Roger the dodger | 17th Jul 23, 6:05pm 1689573912

Makes sense to me. I dont get the opposition to this.

Young people only, so plenty of time to continue to save for retirement.

Only a bond so can only be a modest amount of money.

Many young people have a hard job seeing the point of saving for something so far in the future (in their eyes)

Many lack the available funds for a bond.

Others seem to be saying the taxpayer should pay.

Instead, how about you encourage young people to take responsibility for paying THEIR OWN WAY IN LIFE.

by malamah | 17th Jul 23, 6:12pm 1689574328

Let’s say $2000 for bond, $1000 government contribution, ~$500 employer contribution, ~$500 personal contribution. This policy is literally the opposite of encouraging young people to pay their own way. Not only that, but because they never “held” the money, they don’t necessarily see the value of it disappearing at the end of their tenancy. Out of sight out of mind, socialism feeding privatisation.

Not to mention the opportunity cost of that $2000x5 if they never see it again.

by Roger the dodger | 17th Jul 23, 6:17pm 1689574642

I havent read the policy, does the bond not return to kiwisaver when it is returned at the end of the tenancy?

Surely that is a no brainer given it is held by another govt dept.

Who would pay the bond in your thinking?

by Hamish | 18th Jul 23, 9:29am 1689629366

....return to kiwisaver less the returns that could have been earned whilst still in kiwisaver. A lien would be a more neutral stance. But that might actually require a bit more thought than the young nationals have come up with.

by JimboJones | 17th Jul 23, 6:45pm 1689576347

Why stop at the bond? They probably also need a car, new clothes, a box of piss each week, etc. Repurpose it as KiwiBuyer.

by Roger the dodger | 17th Jul 23, 8:19pm 1689581943

Rather obvious jimbo.

These paymebta along with first home payments are unlikely to depreciate.

Assuming they dont screw up and wreck the place or not pay rent.

by Nzdan | 18th Jul 23, 8:59am 1689627571

I guess you've never rented, looked after the place, but still had to fight with the property manager to receive all your bond money back on pre-existing damages.

One place I rented, they tried to sting me $100 or so to fix the broken heated towel rail bracket. Was noted as damaged at the start of tenancy. But what's even funnier, they used the old photos when relisting showing the broken heated towel rail. They replaced the flooring in the bathroom 3 months in after a section completely rotted away, yet the new listing photo's showed the old tiles.

by agnostium | 17th Jul 23, 7:41pm 1689579708

I'm also fed up of this, let's cancel super so old people can pay THEIR OWN WAY IN LIFE.

by Roger the dodger | 17th Jul 23, 8:22pm 1689582123

Some people rely on super. Some don't.

It is very clear that means testing and an increase in age of elegibility is coming at some point.

But a blanket ruling out of super is not. No idea what your logic is - if any.

by WellingtonInvestor | 17th Jul 23, 11:32pm 1689593572

You mean that the age of Super eligibility will increase when national get in, as that is one of their policies. They are recycling Englishs policy from 6 years ago, that most people under 50 won't qualify for Super and Kiwisaver eligibility until they are 67. The only difference is that they have 6 less years to plan for it. They are essentially reversing Labours reversal of Nationals policy.

by WellingtonInvestor | 17th Jul 23, 11:20pm 1689592846

Because it does absolutely nothing to improve someones wealth for retirement, unlike the first home grant.

If people lack savings for a bond, how are they going to pay the rent, or for other costs.

There is already a bond grant at https://www.workandincome.govt.nz/housing/move-house/bond.html  . So maybe they are planning to do away with that?

I wonder if labours policy will be to get rid of this policy if they lose and then get back in again, just as National did with the super age. I would doubt it. If labour can't manage to gain political points from this, they don't have much of a chance in winning the election. At the moment national can suggest all sorts of rubbishy policies like this and still get in.

by K.W. | 17th Jul 23, 6:17pm 1689574675

If they don't have $1000 to pay the bond in the first place, how will they afford to pay the rent or cover a landlord's insurance excess in the event of damage? Its likely most of them will end up surrendering the bond due to non payment of rent and repairs at the end of the tenancy.

by Roger the dodger | 18th Jul 23, 6:03am 1689616988

Likely most will lose their bond?

I would like to see the data.

I suspect the vast majority of bonds are repaid in full, and I expect this policy wont change that.

by K.W. | 18th Jul 23, 12:34pm 1689640481

The vast majority of Tenancy Tribunal claims are for unpaid rent. A lot of people think they can just skip out on their last few weeks rent and have it taken out of their bond. When this happens, how does Kiwisaver get the bond money back?

by K.W. | 17th Jul 23, 6:37pm 1689575841

On the other hand, it is consistent with the Nats aim to stop wasteful Govt spending. By allowing people to access and spend their own money they are not increasing Govt debt to finance people's wasteful habits. Nor are they raiding the hospital and school funds to pay for it. If it had been the Greens or Labour policy, it would have been "free bonds for everyone, Govt pays" like the free Uni fees, and free "warm and dry" houses, and free EV cars, and free fridges from WINZ ....

Perhaps all the Boomers and Gen Xers have told Luxon they do not want their kids living at home with them until they are 40 and please do something to get them out of the house!

by JimboJones | 17th Jul 23, 6:47pm 1689576423

How do I get one of these free EV cars?

by Pragmatist | 17th Jul 23, 7:32pm 1689579151

You don't, you've been banging on about cycling and public transport so much you aren't allowed one, that would be hypocritical.

by K.W. | 18th Jul 23, 12:41pm 1689640877

https://www.rnz.co.nz/news/national/467240/evs-will-still-be-out-of-rea…

Low-income families who scrap their old car will get funding to buy a low-emitting vehicle in a $569 million scheme, one of the big-ticket items in the government's first Emissions Reductions Plan.

The money will not just be for electric vehicles - it could also help buy an e-bike or could be in the form of public transport vouchers.

by agnostium | 17th Jul 23, 7:43pm 1689579813

If bonds are such a barrier to landlord's profits, just ban bonds.

by WellingtonInvestor | 18th Jul 23, 2:42pm 1689648161

I think a bond is a good idea. But if rents increase significantly, then perhaps there needs to be a maximum bond amount

by pigeonbox | 18th Jul 23, 7:59am 1689623998

Yes paying the bond on a rental is such a terrible wasteful habit

by K.W. | 18th Jul 23, 12:46pm 1689641211

Not getting your bond back because you skipped paying rent or damaged the property so you cant use it for the next place is most defnitely a wasteful habit. And the Nats are going to allow people to do this 5 times?

by kiwi_overseas | 17th Jul 23, 7:44pm 1689579885

Just how inept is the National Party???

Its constantly either policies to unwind existing government policy, policies that favour tax free unproductive use or capital or stupid policies like this.

The Party should dissolve itself now.

by Zachary Smith | 17th Jul 23, 7:53pm 1689580396

Keep in mind the bond has to go back into KiwiSaver. It's a good idea.

by WellingtonInvestor | 17th Jul 23, 11:35pm 1689593742

Who is getting the interest?

by Roger the dodger | 18th Jul 23, 6:04am 1689617042

Now that is a valid point.

by WellingtonInvestor | 18th Jul 23, 2:41pm 1689648088

I roughly calculated that they could be getting $80 million a year at 6% interest rate. That is a heck of a lot of money someone is getting. Surely renters should be getting most of that perhaps minus admin costs.

by Matt_B | 18th Jul 23, 7:38am 1689622711

Who gets the interest currently

by sharetrader | 17th Jul 23, 10:26pm 1689589603

so far national has announced

using kiwisaver for bond, removing the bright line from ten years, restore interest deductibility on rental properties, they have gone quiet on reversing allowing overseas people to buy houses.

good thing there is no one in charge of policy direction that has say 5 rental houses that would benefit by thousands from these policy changes as that would be a very clear conflict of interest.

it is not surprizing how our media don't climb all over this like they did owing a few shares would have them salivating as it's all about rental property investment and that is seen in NZ as the only type of investment that is not a problem when in reality high house prices and rental costs cause so much of our society's problems

by WellingtonInvestor | 17th Jul 23, 11:37pm 1689593843

You forgot about increasing the Kiwisaver withdrawal age to 67 for most under 50 years of age.

by r.james | 18th Jul 23, 3:45am 1689608720

IF this is the best National has to offer we are all up shite creek

by VictimOfOCR | 18th Jul 23, 6:21am 1689618081

Not satisfied robbing our young people today, National allows us to rob the tomorrow.

by Beanie | 18th Jul 23, 8:55am 1689627323

Stand by while the Young Nats come up with their next brilliant idea...such as getting an advance on your future kiwisaver contributions to help you put together a deposit on a house.

by Llama_360 | 18th Jul 23, 9:49am 1689630597

This sounds like a great idea. But National need to think long term. What happens when someone's state subsidised retirement savings are not even enough to pay the bond for a rental? Maybe National should propose some sort of system whereby a person can pledge all their future income to their 'landlord' in exchange for being provided a place to live and enough food to feed their family. We could call the system 'feudalism'. Go on Chris, be brave!

by Small Kev | 18th Jul 23, 10:36am 1689633387

KiwiSaver is not a savings account, it is an investment which one doesn’t really have any real control of.

If you are young and saving up to buy a house then do it otherwise think twice as KiwiSaver more likely not going to exist in 30 years time….

Even if you managed to hang on to retirement your “savings” will become insignificant after inflation. Just imagine what $1 million can buy you in 30 years time and that’s if you have $1m in your KiwiSaver by then.

The system is designed to use your money to “support the market”, it is an idea.

by dollar_bill | 18th Jul 23, 12:50pm 1689641405

Potholes and now this.... New Zealands politicians are running the country on social media reckons. Pathetic state of affairs.

xingmowangs old posts are starting to haunt me.

by safeashouses | 18th Jul 23, 2:19pm 1689646771

use your own money to pay for a deposit - worst idea ever / use tax payers money to pay people cost of living payment of $1000 great idea.........

by WellingtonInvestor | 18th Jul 23, 2:45pm 1689648304

The COL was a form of helicopter payment to offset inflation. It was just a drop in the bucket in terms of covid related costs.

by The_Golem | 19th Jul 23, 10:46am 1689720361

Like policy from pretty well every other party it's a poor symptom fix while doing nothing about the cause. If you want to make homes and rents affordable, make building easier, simpler and cheaper, and fix the tax system. #kludgeocracy

by springtyne | 20th Jul 23, 4:37pm 1689827857

This sux, and why specifically to pay wealthy landlords a bond, not for critical healthcare or search and rescue… who are they listening to that lobbied for this, do they have gold dust in their eyes? A mistake amongst many that will keep them down to under 30% if this kind of misjudgement continues. We need better policy.