Gordon Campbell on National’s clueless stance on National Super

eef49520a81f261a59bdNational Party leader Christopher Luxon seems to be quite a big fan of the conservative mullet – long on populist posturing at the front, but short on state support at the back. So much so that he intends to raise the eligibility age of national superannuation from 65 to 67.

Not that he seems to have any clue – or much interest – in how this change might affect non-rich people. At around the 8.30 mark in this Newshub interview, Jenna Lynch had to enlighten him that the change would actually cost potential retirees an extra 50 grand. As Lynch said in an aside, that’s double what it would have cost retirees if the Labour government had followed through on its much-mocked plan to make the major banks pay GST on the retirement services they provide. We all remember the scorn heaped on the government for that proposal Yet Luxon is proposing to double that impact on retirees, and barely a peep of concern is being expressed. Funny that.

Check out this exchange:

Lynch: So how much extra do people have to save for their retirement over the next 20 years to make up that 50 grand?

Luxon: That’s something.. I can’t give you numbers right here on the spot, and say [them] to you..

Lynch: Shouldn’t you know that, if you’re taking it away from them?

Luxon: We’re giving people anything from 15 to 20 years’ notice to do that. It’s fair, it’s reasonable, it’s pragmatic, and that’s what we’re talking about.

Lynch: Over 15 years, you’d have to save about an extra $70 a week…Who’s got $70 a week extra a week?

Luxon: No, I get it. I’m just signalling to you that ..its expensive for New Zealand. It’s the right thing to do.

All year Luxon has been blundering through these kind of half-assed policy announcements, while showing little ability to defend them or assess what their social impacts would be. The National team love to portray the government as a bunch of out-of-touch elitists. Yet as the above exchange shows, Luxon could hardly be more detached from the outcomes of the policy alternatives he has proposed thus far.

He seems to reside in a different country. In La La Luxonland, almost everyone is comfortably upper middle class, owns at least one home, and is able to switch their investment savings around to cushion the impact of deferring the take-up of their National Super pocket money. Almost everyone else, it seems, is living in a garage in south Auckland planning their next ram-raid. Oh and hey, he’s sorry if that garage comment offended any of the bottom feeders out there. He was mainly just trolling the libs. Doing what he can to unite this divided nation.

Footnote One: In its zeal for fairness and efficiency, National is not aiming to take that pension pocket money away from the older centre-right voters who don’t really need it. He may be dumb, but he’s not that dumb. Wealthy old people vote. So, when Lynch asked him whether a National government was considering whether to means test National Superannuation, Luxon replied enigmatically: “We will talk about our policy down the road.”

When Lynch persisted, Luxon all but ruled out means testing the nation’s pensioners. “No, I don’t see the need for that. Having a universal super system like we have been has been pretty efficient. ..[With means testing] we end up with a whole lot of administration and complexity that doesn’t always flow through.”(?)

Footnote Two: Luxon’s attitude to retirement savings appears to be entirely at odds with the recent review by Retirement Commissioner Jane Wrightson. For several well-researched reasons, the review recommended the retention of the current eligibility age of 65.

In the process, the Commission’s review made mincemeat out of Luxon’s contention that a long lead-in time for raising the retirement age will give everyone plenty of time to plan accordingly. Over the next 15-20 years, things are actually set to get worse for many of this country’s elderly. Many – most? — of them will be unable to avoid poverty without a significant increase in state support. As Wrightson eloquently told RNZ:

We’re trying to bust the myth of the dominant narrative of retirement,” she said, “which is a wealthy-ish person owning their own home with sufficient capital to live quite comfortably. That’s 50 percent of the population, give or take a bit, and that’s going to decline over the next 10 or 20 years.”

Roughly a third of retirees will be renting by 2048 – 100 percent more than today. Māori, Pasifika, and women were the biggest focus for this latest review, because they had disproportionately lower savings, she said. “It’s because they have, generally speaking, earned less over their working life,” They would have suffered more than the normal life shocks, and they would have taken time out of work for caregiving. It was important to these communities to keep NZ Super’s age of eligibility at 65 to avoid further inequality, she said.

Luxon’s response – raise the retirement age! – Seems hopelessly out of sync on this issue with the realities of life. Already, the Commission’s review found, 40% of the renters in the 65-to-74 age group are paying up to 80% of their pension on housing costs. In the Commission’s view, it is imperative to increase the Accommodation Supplement that was capped at $8,100 nearly 30 years ago, back when this amounted to 10% of the cost of an average house. Times have changed.

Finally, Wrightson pointed RNZ towards other groups besides the fortunate Luxonian homeowners who will be living mortgage free in retirement. In her view, two groups are being neglected in the discussions about National Super:

[There are] those who died early – meaning they never benefited from the superannuation they’d paid taxes towards, and those who were surviving on the pension “and not much else”. In addition, Wrightson said there was an “emerging narrative” of those who had to rent in retirement. That group, she predicted, would increase 100 percent by 2048.

“These people are going to have significant issues because NZ Super is predicated on you either having a mortgage-free house, or a comfortable little social housing flat, and both of these aspects … are under significant pressure.”

None of this seems to be getting through to Christopher Luxon. His response (thus far) has been to suggest taking 50 grand out of everyone’s savings for retirement, by pushing the current levels of assistance two years further out of reach. Inevitably, more people will die before getting the benefit of the retirement payments for which they paid taxes all their lives.

But from Luxon’s lofty vantage point: “It’s the right thing to do.”

Second guessing MIQ

Any side-line genius will tell you how the game should have been played: The options not used, the lack of speed to the breakdowns, the dropped passes under pressure… And hey ref, why wasn’t a red card issued for this or that lapse in standards? The pandemic has been a rich field for these kinds of exercises in 20/20 hindsight. This government is rubbish! Change the coach!

For a classic example of finding wisdom in the rear view mirror ….The people responsible for running our MIQ facilities got roundly condemned this week in a report by Chief Ombudsman Peter Boshier. Allegedly, the people responsible for MIQ had acted “unreasonably” in the way they’d managed the virtual lobby for MIQ spots. That judgement was the part of the report that made the headlines.

Yet according to the report, it wasn’t as if a better system with more humane options was sitting right there on the shelf, ready to go. As Boshier conceded, New Zealand was trying to do something we’d never done before while under immense pressure, and on a huge scale. Oddly, the major problem for Boshier seemed to be that MBIE hadn’t done enough work to provide suggestions for what a better system might look like, and how it might operate! Supposedly, this was a failure in blue skies thinking as much as any operational lapse. Here’s Boshier:

“I acknowledge that another type of system, which provided for consideration of individual circumstances would have been more complex, time-consuming and costly to implement than the virtual lobby…. But I do not consider these challenges provided sufficient rationale for MBIE not to advise and recommend to decision-makers options for such a system – the impact on people was too severe.

So it would seem that MBIE failed on the whiteboard as much as anywhere else. (Didn’t MBIE realise that when you’re brainstorming how to manage the borders against the unprecedented threat posed by a deadly virus, that no idea is a bad idea?) If one can believe the Chief Ombudsman, an imaginary case-by-case approach might conceivably have led to more reasonable decision-making on some occasions.

Few would disagree. No doubt, given unlimited resources, fewer life-and-death pressures and fewer concerns about making precedent-setting decisions that might endanger the wider community… Well, I’m sure a way might have been found to make things go a lot better on the day.

No doubt useful lessons need to be learned! Maybe we can all learn from the Covid experience how to achieve neater and nicer outcomes next time a deadly virus hoves into view. Hopefully, we can do so without letting our compassionate motives lead us into making humane exceptions that then jeopardise the safety of the entire community. Yet to use the Ombudsman’s report to paint the MIQ system as a “failure” – as some people have done – looks like a grotesque attempt to rewrite history.

Footnote: Routinely, pandemics play havoc with individual liberties. That tends to come with the territory. That’s because the rights and needs and desires of the individual always have to be weighed against the potential risk that runaway infections could pose to the greater good, especially in the period before significant levels of vaccine protection have been put in place.

Talking of which… Para 41 of the Ombudsman’s report says that “approximately 230,000 people went through MIQ”. Yet the same report tended to focus on complaints that ran into the low hundreds at most. Meaning: Yes, there were severe consequences for some individuals caught up in the MIQ system. Those consequences however, seem to have befallen relatively few numbers of people. Overall, the MIQ system appears to have enjoyed wide support among the majority of the population, who appear to have been very grateful for the protections it delivered.

Overlords as underdogs

Like everyone else, I was enjoying Morocco’s plucky run at the football World Cup until some killjoy reminded me that for decades, the kingdom of Morocco has been plundering the phosphate reserves that belong to Western Sahara, and selling a lot of itf to willing buyers in New Zealand. Not even the Guardian held back:

This was history, a pay-back for the passion and massive investment in Moroccan football by King Mohammed VI and the national federation.

So we know where at least some of the money came from that took Morocco to the semi-final. Drat. Are there no virtuous underdogs left in the world?

Pressure to Party

Talking before about social isolation… This recent Julia Jacklin track manages to be a propulsive piece of pop music while still doing a pretty good job of conveying personal tentativeness and social paranoia:

Changing the subject entirely… The great Cuban singer songwriter Pablo Mllanes died of cancer in Madrid a few weeks ago. For decades, Milanes and his sometime collaborator Silvio Rodriguez had been the voice of the Cuban Revolution. As the New York Times wrote in its glowing obituary, Milanes was one of the originators of the nueva trova movement, a post-revolutionary genre in which he combined elements of Cuban son and guaracha with soul, jazz and folk rock.

On “La Vida No Vale Nada” Milanes sang about how life means nothing if it can feel comfortable while others continue to suffer. On “Son De Cuba a Puerto Rico ‘ he likened the two former Spanish colonies to the wings of the same bird. His love songs were just as memorable. This 1970s song to his then-wife (he was married five times) has long been a personal favourite: