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Briefing Note 41 - Are there lessons from KiwiSaver for the UK?
New Zealand’s KiwiSaver is the world’s first voluntary national retirement saving scheme that uses automatic enrolment. It went live on 1st July 2007, following changes announced in the Budget 2007 that introduced for the first time: compulsory employer contributions; a subsidy for employers; and a Government contribution to match members’ contributions.
This Briefing Note explores the similarities and differences between KiwiSaver and personal accounts to see if early indications of New Zealand employee and employer behaviour could provide lessons for the UK. It finds that some of the key risks in the UK context (interaction with means-tested benefits/risk of levelling down) do not apply to the same extent in New Zealand and different incentives for new joiners may drive different participation rates. The UK pensions sector will continue to watch with interest to see how employees, employers and providers respond to KiwiSaver.
A Supporting Members event was held on the 10 July 2008 hosted by Hewitt Associates. The policy seminar looked at lessons from New Zealand's KiwiSaver Scheme for the UK Government's pension reforms.
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