The government is sending pretty clear signals that it will suspend payments to the Super Fundd.
Speaking at the launch of the DeloitteSouth Island Index last night, Bill English said:
When it was set up, the idea of the Super Fund was to invest Budget surpluses. The Government was then in surplus and expected to stay in surplus for the foreseeable future. . .
Those Budget surpluses have disappeared. The Government will run a deficit this year, and will do so for the foreseeable future. That changes the whole picture.
The Government will have to borrow quite a lot of money to makes its full Super Fund contributions. Next year we would have to borrow around $2 billion, or around $40 million a week to put into the Fund, to be invested in what are currently uncertain global financial markets.
That’s why we’re considering this issue, and that’s why the Fund’s rules allow the Government to vary its contributions to reflect changing fiscal conditions.
If the words don’t convince you suspending payments is a good idea, Garrick Tremain’s picture might: