15 September 2004
INDUSTRY PLEASED WITH WORKPLACE SAVINGS
REPORT
"The Investment Savings and Insurance Association (ISI)
welcomes the final report of the Savings Product Working Group as the first of a trifecta
of important reviews aimed at improving New Zealands alarmingly low personal savings
rates. The other reviews include the taxation of savings products under the leadership of
Craig Stobo and the review of adviser regulation recently announced by Minister Margaret
Wilson", said Vance Arkinstall.
"The ISI is pleased that the Savings Product Working Group
findings support our belief that savings by deduction from salary is the most efficient
and effective option", said Mr Arkinstall.
"A key part of the Group’s work revolves around the
lessons from psychology and why people save or don’t save. This is an area that
requires further consideration. Experience shows that economic rationality and logic has
not been successful in raising NZ’s personal saving rates."
ISI is also encouraged at the Group’s finding "the
Group has concluded that current practice will not alter materially if the status quo
prevails. Change will need to be orchestrated."
"Not every one will support the outcomes but the
Group’s recommendations have merit. It is essential that any implementation process
recognises that minimising compliance on employers is essential. Also administration for
products must be kept at an absolute minimum to provide cost efficient options to
consumers, ie the employees", said Mr Arkinstall.
"The concepts of a ‘pathway’ and ‘the light
on the hill’ are supported by ISI. Saving is a highly complex and emotional subject
and the Working Group proposal is a further step towards increased personal responsibility
for saving and preparation for advancing age."
"The savings industry welcome this work and the practical
options it proposes. We will be providing a positive contribution to the submission
process that the Minister has announced."
For further information contact:
Vance Arkinstall, Chief Executive
