NZ Election KiwiSaver Policies
Oct 26, 2026
The Background - KiwiSaver
KiwiSaver was first launched in July 2007, established under the KiwiSaver Act 2006 under the Helen Clark-led Labour government. At the time, all joiners received a $1,000 kick-start contribution to incentivise joining the scheme. This led to the signing up of many newborns and minors which continued at a steady pace until 2015 when it was removed by the National government as part of the 2015 budget. Almost 20 years on, many of the newborn sign-up cohort are now working and adding to that initial sum (which will have compounded to varying degrees over time). As of the end of June 2026, there was about $148 Billion NZD worth of assets held within KiwiSaver, a figure which has likely crept over the $150 Billion mark since then.
There have been many changes to KiwiSaver (and tax that effects KiwiSaver) over that near 20-year period, including changes to default employee contribution rates, changes to employer contribution requirements, changes to tax thresholds, the renaming and reduction of government contributions, and the creation of many different KiwiSaver Schemes (as well as acquisitions and mergers). Overall, the scheme in our view has grown well and been an overall success to date, but most political parties in New Zealand hold a view that it has a long way to go to catch up to neighbours (competitors?) Australia, and numerically speaking, this is true.
With a population of ~28 million, there is a grand total of about $4.5 Trillion AUD worth of assets in Australian Super. That's an average of about $160.7k AUD per person. An equivalent of just shy of $200k NZD per person (using FX rates as of the date this was written).
Contrast this to KiwiSaver, where Stats NZ estimates our population at 5.36m, and a total of about $150 Billion NZD in KiwiSaver, this amounts to $28k NZD per person average balance (Meaning Australians hold an average superannuation balance more than 7x as large as Kiwis). This has led to a commonly held view amongst political parties coming into this election that KiwiSaver needs to continue to be bolstered so that New Zealand can 'catch up' with our neighbours. What differs significantly amongst the parties is:
What should be done about it
How big the problem is/isn't
Which factors are the specific problem(s)
Where the responsibility lies
Below is our best attempt at an objective summary of all the policies presented by the various parties campaigning for election in alphabetical order of party (where they actually have a policy or a policy that directly impacts KiwiSaver) - for example Animal Justice Party Aotearoa New Zealand, Aotearoa Legalise Cannabis Party, Conservative NZ Party, Free Palestine, Green Party, NZ Outdoors & Freedom Party, Te Pāti Māori, Te Tai Tokerau Party & Vision New Zealand all do not hold KiwiSaver policies that we could find).
Please note: Our commentary is primarily looking at these policies in isolation. Voters will naturally have opinions on the cost/benefit associated with different policies. We aren't providing extensive analysis on this.
ACT New Zealand
Proposes to:
No tax on qualifying investment earnings inside KiwiSaver.
Remove annual Government Contributions for members receiving contributions from an employer (currently 25c contributed from government each year, per $1 contributed from employee contributions + any voluntary contributions up to a maximum of $260.72 contributed by government each year. Government contributions still remain for those that are not receiving employer contributions such as self-employeds and contractors).
Put safeguards in place to keep KiwiSaver focused on retirement saving and prevent it being used to shelter large existing investment portfolios from tax.
Implement the same tax-relief for non-KiwiSaver superannuation schemes.
Our thoughts:
From a purely numerical point of view, assuming KiwiSaver remains an asset not taxable on eligible withdrawals (i.e. retirement), the tax removal in this policy will substantially increase the amount KiwiSaver will provide for an individual in retirement. Act provides various estimated numbers in their policies, but from our own numbers (depending significantly on fund selection for each individual), they are likely conservative, especially for younger KiwiSaver members who could benefit by having as much as 40% more at retirement (without changing contribution rates).
Self-employeds & contractors have little incentive in KiwiSaver currently to do anything more than contribute the $1042.86 necessary for the max government contribution of $260.72 each year (provided they earn less than $160k p.a.). A tax break on investment earnings will likely incentivise contributions significantly for this cohort.
It's unclear how or what 'safeguards' look like to prevent KiwiSaver being used to shelter large existing investment portfolios from tax - i.e. someone over 65 can freely come and go from KiwiSaver as if it were any other investment portfolio, so you'd have to assume this may mean providing tax exemption up to a certain age (probably 65) and/or making some contribution limitations over certain timeframes.
While it goes beyond the scope of only KiwiSaver, implementing that same tax-relief for non-KiwiSaver Super Schemes is a very interesting 'marketing' opportunity for New Zealand. Most foreign superannuation schemes use an 'EET' model - exempt from tax on the way into the scheme, exempt while invested in the scheme, and taxed on the way out of the scheme (as a form of income). NZ is one of the few that is TTE - taxed on the way in (in the form of ESCT and employee contributions coming from net income), taxed while in, and exempt on the way out. Moving to a 'TEE' model creates significant incentive for NZers holding foreign superannuations to shift them back to NZ because they get a round trip which is effectively EEE (apart from any tax NZ can hit them with on the initial repatriation of funds). It's assumed that the tax relief on 'non-KiwiSaver superannuation schemes' would apply to transferred foreign supers (as they tend to transfer into these sorts of schemes. Would this policy potentially create incentive for NZers to return home and bring their funds with them?
The proposed tax cost in the policy in 2027/28 from removing tax on KiwiSaver earnings looks slightly low from our estimates - probably about 10-20% low, but one would assume it's a derivative of historic IRD tax numbers, and the real tax cost depends massively on the returns generated in financial markets each year which is very difficult to estimate accurately. The proposed policy is likely a net revenue cost to the government in the short-term, but whether this is fully borne now and over time depends on variables like the increasing fee revenue of KiwiSaver Schemes (and tax they pay) over time from higher compounding balances, how much repatriation of foreign super occurs as a result, and whether this encourages NZ ex-pats to return (all very difficult factors to individually measure as a result of this policy if implemented).
If the government wants to go a route of reducing dependence on NZ Super longer-term (i.e. means testing, raising age of eligibility or changing other eligibility criteria), then this is probably the most impactful policy offered by any party as it will create the greatest savings incentive, particularly for self-employeds.
Alliance Party
Proposes to:
Introduce an automatic $10,000 'endowment' for all new KiwiSaver accounts, ring-fenced until retirement or terminal illness.
Phase out the use of 'active' KiwiSaver funds, investment being directed into passive funds focused on local infrastructure and investment.
Shift KiwiSaver in the direction of the long-since repealed Superannuation Act (1974).
Maintain a universal state pension as a fundamental social right, with no means testing, from at age 65 and at 72.5% of the after-tax average wage and adjusted for inflation over time (while this isn't strictly a KiwiSaver policy, the two are inherently tied together in their policy, so has been included here).
Our thoughts:
Unclear if the endowment amount is usable towards a first home purchase or withdrawable if someone moved overseas permanently. Wording of the policy would seem to suggest in the latter scenario it would be repayable as the overall focus of the policy is about greater investment in New Zealand rather than benefitting overseas economies.
It's unclear who would end up deciding how investment decisions are made/capital is allocated as nothing 'passive' is ever truly passive. i.e. someone or a group have to decide what framework is set for 'passive' - i.e. Does it look like X% of funds invested in the NZX (is this into the NZX50? Some other index?), X% in bonds/cash term deposits, X% in infrastructure and other projects? Who would manage the investment into infrastructure and other projects? It would likely mean the end of almost all KiwiSaver Schemes as we know them - i.e. if capital can't be actively managed and is to be directed into local infrastructure and economy, then any scheme differentiating themselves on that basis would either be forced to change or cease to exist.
Currently there is a great deal of optionality within KiwiSaver to factor personal ethics into the equation (as different KiwiSaver Schemes have different ethical lenses), it's likely this would be removed from the equation entirely, meaning all KiwiSaver members would be subject to the ethical views on this front from whichever person/organisation/group is making decisions on capital allocation.
This would massively redirect KiwiSaver capital back into NZ-specific investments. Currently almost exactly 1/3 (according to Morningstar) of KiwiSaver is invested in NZ-specific investments. I.e. about $100B NZD of capital would be reallocated to New Zealand. This would likely have a profound impact on the NZX (again depending on the point above), as the total NZX is worth about $250B NZD.
Labour Party
Proposes to:
Introduce mandatory employer contributions from 1 July 2028 (regardless of whether an employee is contributing). Increase them to 6% by 2032.
Set employee default contribution rate at 4% with no minimum employee contribution rate (Currently the minimum is 3% or zero if on a Savings Suspension).
Ban new total remuneration contracts (this is where KiwiSaver contributions are absorbed into salaries).
Employer contributions included for those working and over 65 from 1 July 2028.
Explore more flexible KiwiSaver options for self-employed New Zealanders.
Introduce a KiwiSaver contribution for parents while on paid parental leave.
Our thoughts:
Ensuring contributions are going into KiwiSaver over time (to build retirement savings) by decoupling employer contribution requirement with whether the employee is contributing or not should boost retirement balances for the average member.
Increasing total contributions (whether through employee, employer or some combination), is likely to be the single largest factor for 'catching up' the average KiwiSaver balance to the average Australian Super balance over time.
Removing total remuneration contracts will cause higher KiwiSaver contributions over time, leading to higher average balances, and will almost certainly be absorbed by employment contracts having lower gross incomes accordingly (or not increasing incomes annually as new contracts are offered/increases being at a lower rate for a time as the cost is passed through). Employer contribution rises will also likely be passed through by the average employee receiving slightly lower pay rises annually to account for the increased contribution rate.
KiwiSaver contributions for those on parental leave are indicatively going to be a cost borne by the government. The policy proposes that higher employer contributions and the ESCT that comes with this will help fund this, but in our view the reality is that most employers will likely just offset the higher cost by passing through lower annual salary increases to employees as the employer rate ratchets up over time, than they otherwise would have if not there. This means more income in ESCT and less in income tax. Additionally, ESCT has more generous tax bands than income tax (i.e. 39% is $216k+ p.a. for ESCT while $180k+ p.a. for income tax), so the total tax take may in fact be lower.
Removal of minimum contribution rates is helpful when individuals can't afford the current default 3% employee contribution but still want to ensure they contribute enough to receive the maximum government contribution each year. Currently it is doable but requires the admin of going on a 'savings suspension', then manually setting up sufficient voluntary contributions and extending the savings suspension each 12 months as needed, or remembering to end it short of that timeframe if relevant.
National Party
Proposes to:
Make contributions to KiwiSaver or an equivalent scheme compulsory for all workers from 1 July 2028, increasing total contributions to a default of 12% by 2032. Employee and employer contributions would each rise 0.5% each year from 1 April 2028 through to 2032 until at 6% and 6%.
Introduce automatic enrolment at birth from 1 July 2027 with a $1,500 kick start contribution.
Include employer contributions included for those working and over 65 from 1 July 2027.
Introduce a KiwiSaver contribution for parents while on paid parental leave - at the default rate.
Our thoughts:
National are openly quoting the view that NZ is behind Australia in the superannuation regard with the 12% annual contribution from income being compared to what Australia is doing on the contribution rate.
Making KiwiSaver compulsory will be met with an increased number of hardship withdrawals. Many (but not all) of those not actively involved in KiwiSaver are those that can't afford to make those contributions. The Retirement Commission stated in 2024 that ~96% of the working population in NZ are already enrolled in KiwiSaver and that non-contribution is concentrated in low-income earners, part-timers, self-employeds and those outside paid work.
Like Labour, National are proposing that employer contributions will be included for those over 65 and working. The only difference is National is proposing to introduce this 1 year earlier than Labour. Therefore, it looks likely that some form of this policy is a near-guarantee for implementation post-election (from our read, it's unlikely coalition partners for either Labour or National will strongly oppose this one).
Interestingly National are looking to undo their prior change in removing the kickstart, and not only undo but make it more meaningful than the original one ($1,500 instead of $1,000). Mandatory enrolment at birth is interesting and provides some benefits to future generations by way of having funds compounding for their future benefit. We would assume the existing default KiwiSaver Scheme pathways would work for this, but some process/infrastructure will likely be needed for automatically creating IRD numbers very soon after birth for all kids born in NZ as KiwiSaver relies on IRD infrastructure. Otherwise, kids would probably end up being defaulted to the top PIR tax rate of 28% rather than the 10.5% most would qualify for. Default KiwiSaver Schemes will like this policy.
Like Labour, National see KiwiSaver contributions for parents on paid parental leave as important. Their proposal is based on making the employer contribution; therefore it relies on an individual still making employee contributions, compared to Labour proposing it being detached from employee contributions. Given National want to raise employer contributions to 6% over time, this would affect this policy. Labour in contrast have not specified what amount the parental leave contribution would be set at.
New Zealand First Party
Proposes to:
Introduce automatic enrolment at birth with a $1,000 kick start contribution for NZ Citizens only.
Make KiwiSaver enrolment compulsory for the wider workforce
Increase employee and employer contributions to 8% initially and eventually to 10%
Our thoughts:
The overall policies are very similar to those proposed by National. NZ First did seemingly announce their policies first, and it overall looks like National is prepared to primarily back them.
We were unable to find specifics on the proposed changes to contribution rates in terms of dates and how they are to be staged. Our read is that National's stepped changes of 4% employee and 4% employer on 1 April 2028 and then 0.5% increases to each, each year following until 2032 will probably align.
The birth enrolment and kickstart contribution differs to National's in the amount and whether it applies to residents or just NZ citizens. If some form of National / NZ First coalition is elected, then a mandatory at-birth enrolment with some form of kickstart looks likely. The exact dollar value probably won't present much friction, with the debate likely to centre on who it applies to (NZ Citizens only or also permanent residents).
New Zealand Loyal Party
Proposes to:
Eliminate tax, to be replaced entirely by a 1% transaction tax policy (while this isn't a KiwiSaver policy, it would have direct KiwiSaver ramifications), removing the IRD
Our thoughts:
NZ Loyal don't have a specific KiwiSaver policy, however the tax proposal would have enormous ramifications on the KiwiSaver front, hence it has been included.
Removal of tax on earnings could have a similar impact on KiwiSaver account growth to Act & Opportunity's proposal, however investors would be heavily incentivised to make as few changes to asset allocation as possible over time if every change attracted a 1% tax. It would mean lower tax on initial contributions than any policy except from Opportunity Party, but a range of outcomes on investment earnings depending on member activity, being potentially 3rd highest net of tax (behind Opportunity and Act), through to higher tax than any other proposal (if the member was making many changes in a given year). As for drawdowns out the other end, only Opportunity would have a higher implied tax.
If the IRD ceased to exist, you'd need a completely new organisation set up to help run KiwiSaver as the IRD currently facilitate employee and employer contributions, plus the transfers from one KiwiSaver scheme to another. This would have significant up-front admin costs associated.
Real tax charged would likely end up being higher than advertised on the tin - i.e. Would there be 1% taken from the employee contribution as it is passed on to the IRD-replacement facilitator, then 1% again as the facilitator passes it on to the custodian of the KiwiSaver Scheme, and then 1% again as the funds are invested? The definition of a 'transaction' would matter significantly and might not always be simple to define.
It would incentivise KiwiSaver members not to switch schemes as it would create a more meaningful cost to doing so than any other KiwiSaver policy or than what exists today (i.e. 1% of someone's total balance as a fee, and as above, depending on what is or isn't viewed as a transaction, this could be charged 3 separate times in a transfer). This would probably have some significant ramifications for the competitiveness of KiwiSaver over time (higher switching costs between schemes favours incumbents over new competition).
Opportunity Party
Proposes to:
Introduce a Compulsory contributory superannuation system (which they call KiwiSaver 2.0), with contributions reaching 12% of gross earnings, being 6% employer and 6% employee, phased in over 6-7 years, increasing 0.5% p.a. (similar to National's proposal).
Have KiwiSaver 2.0 entirely separate from the existing voluntary KiwiSaver Scheme, which will remain as a supplementary savings vehicle. Existing KiwiSaver members could voluntarily transfer funds across.
Prevent KiwiSaver 2.0 from being withdrawn for hardship or first-home deposits, but bank loans will be able to be taken against balances.
Make the full 12% KiwiSaver contributions exempt from income tax, with investment earnings progressively reduced over time, being fully exempt after 20 years.
Our thoughts:
This undoubtedly represents the largest and boldest proposed changes to KiwiSaver of any KiwiSaver policy and there is a lot to digest here. KiwiSaver 2.0 is effectively an entirely new system that side-pockets the existing one into being a 'grandfathered' scheme.
The proposed changes will create more confusion to the public than any other KiwiSaver policy. It took NZers a long time to understand KiwiSaver (and many still don't). Creating a second version while the first still exists is going to require a lot of time and cost to government departments, existing KiwiSaver Scheme providers and Financial Advisers to educate the public.
Allowing the bank to lend against a KiwiSaver 2.0 account is an interesting proposal and one that has been previously raised for the existing KiwiSaver structure but was forbade under the initial KiwiSaver Act because initially policy designers were worried KiwiSaver would become like a revolving credit account. The key question here is if the scheme is strictly to provide retirement benefit, with no hardship withdrawals, how would it deal with a scenario of someone refusing to pay their mortgage that had been lent with the KiwiSaver 2.0 account used as collateral? We would assume the lender would take possession of the funds in the account to cover for the unpaid debt. Would this then be a commonly used mechanism for members to make use of their funds in this account prior to age 65, and therefore negate the purpose of creating a 2.0 version of KiwiSaver in the first place?
There's no reason that changes couldn't be made to the existing KiwiSaver Act to prevent first home purchase use from being allowed and the balance instead being able to be lent against to help in securing a mortgage instead - this essentially provides a similar mechanism for first home savers. This seems to be one of the primary drivers for proposing a KiwiSaver 2.0 to exist. Changes to the existing format instead of a whole new scheme prevents the confusion a second scheme creates for the average NZer.
Use of KiwiSaver funds as collateral rather than home deposit means arguably superior use of capital because it allows a younger investor to remain invested in assets in their KiwiSaver account that are focused for the long term (i.e. close to 100% in growth assets), rather than having the pressure of holding shorter-term focused funds to balance the home withdrawal goal. Given growth assets net of tax (especially if tax is being removed over time), should outperform the interest cost of lending, it should be a net advantage to investors long-term.
For KiwiSaver 2.0 it is unclear what happens in the scenario that someone moves overseas permanently - one would assume that funds would have to remain in NZ until they reach age of eligibility for withdrawal.
If they end up being the swing vote, Opportunity might find significant components of their proposal are palatable by both the right and left blocs, but it looks unlikely either side will want to go a full KiwiSaver 2.0 route, rather than just implement some combo of their proposals within the existing framework, with perhaps 1 or 2 other tweaks. Commonalities include mandatory KiwiSaver (supported by National & NZ First), mandatory contributions rising over time from employers and employees at similar rates to proposed (supported by National, Labour & NZ First), make investment earnings exempt/exempt over time (similar-ish to Act).
It's not clear how KiwiSaver 2.0 withdrawals at the other end would be treated. If we are exempt on the way in, exempt (over time) while in there, then what is typically done globally is taxing them on the way out. If this isn't implemented and a full tax-free lifecycle is proposed, this would be even more aggressively anti-tax than what is proposed by Act. Most commentators assume it would be taxed on the way out at the other end.
The KiwiSaver proposal is tied in with over very significant tax system overhauls, many of which are proposed to take more than 10 years to fully implement. Opportunity's policy probably therefore has a higher probability of being overturned in future years than any other party given how long the proposals are expected to take to be implemented (i.e. we are talking about spanning more than 6 future governments for some).
Women's Rights Party
Proposes to:
Require an employer to treat all its employees the same when it comes to the employer KiwiSaver contribution
Address pay gap equity as it relates to KiwiSaver contributions, as a result of "low pay in typically female jobs. low income over their lifetime, part-time employment and career breaks to raise children"
Continue employer contributions to KiwiSaver during maternity leave.
Address the "motherhood penalty" with a State contribution to the KiwiSaver account of the carer to recognise the social value of childcare.
Our thoughts:
Ensuring an employer treats all employees the same in respect of employer KiwiSaver contribution %s is a reasonable expectation. The argument largely centres around more senior roles sometimes having higher employer KiwiSaver contribution % offers than more junior roles with the same employer, and with more senior roles tending to be male dominant given males tend to less commonly have the child-caring career break that women tend to have on average which can hold back career progression. It's unclear what the exact proposal looks like other than a law that an employer must have KiwiSaver contribution %s that are equal for all employees (no specific proposed fix by the Women's Rights Party). The drawback would be this would eliminate the ability of an employer to work with an employee to take advantage of a salary sacrifice arrangement (where the employer contributes more instead of the employee contributing more from their pay as employer contributions have more generous tax bands than employee contributions do, and as a result this can mean higher net contributions into KiwiSaver for the employee at no extra cost to the employer).
Pay gap equity as it relates to KiwiSaver contributions and balances is a very nuanced debate. The Women's Rights Party highlights the major factor that unpaid child-raising is on KiwiSaver contributions and balances for women over time. It's worth noting that KiwiSaver is treated as relationship property, which means it comes into play in the case of relationship separation (i.e. it is factored as an asset to be divided should a couple split). We have seen clients go through this on both sides of the ledger. Therefore, for a woman that has been a stay-at-home mum for many years and finds herself divorced/separated near to retirement, her ex-partner's KiwiSaver balance is included in the division of assets. Whether those subject to separation have actually received legal advice and been able to obtain what they are due is perhaps the bigger factor here than whose KiwiSaver account specifically holds what dollar value along the way. Probably those whose KiwiSaver balances over time are most affected currently are single mothers who have been child-raising on their own from an early stage in their child/children's life, and therefore missed out on the compounding opportunity of KiwiSaver contributions. The current policy doesn't provide any detail on the proposed fix.
Continuing employer contributions into KiwiSaver while on maternity leave seems broadly supported by both National & Labour, so in our view this is highly likely to see implementation post-election regardless of the result (it also seems unlikely to be very contentious to any of the coalition partners).
Want to Review Your KiwiSaver Account?
Whether you are looking to stress-test your current KiwiSaver strategy, adjust to election changes as they occur, or explore alternative asset allocations, we are always open to a conversation. Get in touch with the team today for a free enquiry meeting. We would love to help you as we have helped many others.
Global Government Bond yields have been skyrocketing in the last 12 months, and not specifically in 3rd world nations. Investors need to pay attention to what this potentially means for their broader investment portfolio and give some thoughtful consideration on what actions they take, if any.
Since early 2024, demand for Bitcoin exposure via reliable, regulated investments has exploded. This has come in the form of spot ETFs, Bitcoin Treasury Companies, Bitcoin Mining Companies and other companies holding Bitcoin on their Balance Sheet. As demand has evolved globally, even more Bitcoin-themed investment options have become available for KiwiWRAP KiwiSaver Scheme members.
With escalating concerns about the US dollar and general currency debasement, we are observing an increasing demand for exposure to assets like gold & silver (along with Bitcoin) as hedges. Inflation resulting in cost-of-living concerns, geopolitical risks, and the reclassification of gold as a ‘tier 1’ reserve asset for central banks (next to Treasuries), has led to significant price appreciation for these alternative forms of money in recent years.
