The Green Party today welcomed the Government's timely review of KiwiSaver costs.
"A significant part of New Zealanders' savings get eaten away by costs and fees. By offering a default public KiwiSaver option, we can lower costs sizably, saving KiwiSavers tens of thousands of dollars," said Green Party Co-leader Dr Russel Norman.
The Savings Working Group estimates that a single large provider can reduce the costs of KiwiSaver by a factor of two-to-three. A 40 percent saving in costs and fees over the lifetime of a typical KiwiSaver account will result in a bigger nest egg on retirement of anywhere from $23,000 to $142,000.
"A public option KiwiSaver fund can be managed by the Guardians of the $16 billion New Zealand Superannuation Fund while Kiwibank or the Inland Revenue Department can provide the front-end management of individual KiwiSaver accounts," Dr Norman said.
"The Australian Government announced similar but more sweeping changes to their superannuation industry last year.
"Like Kiwibank, the public fund will be New Zealand owned and managed in an arms-length, commercial way."
Green Party plan for lower KiwiSaver costs: