Labour holds off on promise to restore KiwiSaver top-up
Labour leader Chris Hipkins says Labour cannot promise at this stage to reverse the cut to the government KiwiSaver payment.
The payment was halved in Budget 2025, from $521 a year to $260, and limited to those earning under $180,000, according to RNZ. Labour's KiwiSaver package, released on Sunday, contained no commitment to return it to its previous level.
Speaking on RNZ Morning Report, Hipkins said there is a lot of pressure on any incoming government after the election. He said he would not give that commitment now.
The package centres on compulsory workplace contributions rather than the Crown top-up. Labour would raise employer contributions to 6 percent. Employees could contribute at 4 percent and pause their own contributions if they wished, rather than being required to match 6 percent.
Labour would also ban new total remuneration packages. That is where the employer contribution is treated as part of salary, rather than paid on top of wages.
Earlier detail from the party set out a stepped path for the default rates, from 3 percent to 3.5 percent from April 2026, then to 4 percent by 2028. From 1 July 2028, employer contributions would become compulsory and would extend to paid parental leave and workers over 65, according to Labour. Employer contributions would continue even when employees reduced or paused their own contributions, as reported by the NZ Herald.
Hipkins said: "KiwiSaver is one of Labour's proudest legacies. We created it, and now we're going to make it work better for people."
On tax, Hipkins said Labour would set out its position on landlord interest deductibility, the rules for landlords claiming mortgage interest as an expense, in due course after the Pre-election Economic and Fiscal Update, Treasury's pre-election update on the books, later this month. He did not pre-commit ahead of PREFU.
The broader context here is about Labour managing costs into the campaign. It is willing to impose a rising cost on employers through the contribution schedule, while refusing to take on the direct cost to the Budget of restoring the $521 credit before it has seen Treasury's books. That keeps its fiscal baseline tight into PREFU and leaves the government contribution as a second-term option rather than a first-Budget liability. The points to watch are the interaction with wage talks around total remuneration, the treatment of over-65s and those on paid parental leave, and whether PREFU headroom changes the landlord deductibility call.
