I’m not opposed to the idea of increasing the age of eligibility for superannuation.
When it was introduced it wasn’t universal and life expectancy was quite a bit lower than it is now.
Jacqui Dean: What does the report say about the costs of meeting superannuation, and how does this compare with the benefits of sound fiscal management?
Hon BILL ENGLISH: The report shows that increasing the age of eligibility from 65 to 67 for national superannuation makes a difference of around 0.7 percent of GDP by 2030. The report also shows that maintaining the Government’s fiscal strategy of returning to surplus with moderate increases in spending and investment and better public services through to 2020—just 7 years from now—will reduce net Government debt from around 50 percent of GDP to under 10 percent of GDP. So, clearly, managing Government expenditure well has a much bigger impact on our future debt loading than small adjustments to national superannuation.
This strategy isn’t without risks, however.
Jacqui Dean: What alternative strategies for fiscal management would put the Government’s progress in reducing debt at risk?
Hon BILL ENGLISH: Well, of course, we get to reduce debt once we get to surplus, and once we get to surplus we need to make sure that we do not spend those surpluses on ineffective public services but that we do spend them on reducing debt. Alternative strategies that would make it harder would be those that we inherited as a Government from when Government debt was forecast to reach 50 or 60 percent of GDP simply on the basis of loose and wasteful spending by the previous Government.
If we want first world services and support we need first world incomes and that requires policies and management that foster an environment for growth.
Those disenchanted with the government like to say there’s no difference between National and Labour.
But the National-led government is doing a far better job of managing public money, while maintaining services, in difficult financial times than Labour managed when the rest of the world was booming.
A surplus is in sight and once it’s achieved we have some choices over what to do with it.
LabourGreen want to spend more, National wants to reduce debt to ensure the economy is on a much stronger foundation to weather future storms than we were for this one.
Even if Labour can sort itself out, does anyone seriously think they’d want, let alone be able, to reduce the burden of government while maintaining services as National has?