Tuesday, 7 March 2017

Superannuation: It’s politics, stupid


So why did Bill English touch what Americans call the “third rail” yesterday, talking about changing superannuation and in election year too, only to make what looks like a savage and irresponsible punt – putting off any of the necessary changes out to a time so far in the future there is dust and heat haze between us and the horizon?

The answer is simple.

While his predecessor was happy to break every other election promise he ever made, he stood firm on the one pledge he knew would kill him: he pledged to quit as Prime Minister before ever raising the retirement age of 65. That took the issue of the table politically, without ever addressing how the over-generous welfare package would continue to be funded.

But the very minute his successor refused to renew that pledge, that issue came back on the table with a rush. Which meant unless he addressed it properly – or was seen to address it properly – that question would hound him all through the election year: “Are you going to raise the retirement age?”

So he had to address it. Or be seen to.

By kicking the can out to the year Anno Domini 2037 he chose the latter course. He has taken it off the table for his election year, he has allowed himself room to bag Labour for reversing their sensible policy from 2012, but – crucially – he has made superannuation no more sustainable as on ongoing proposition.

It suggests that as Prime Minister he will be a punter, not a problem solver.

And that this issue will be an issue again some year very soon. As it deserves to be.


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