JD
As a Kiwi would you pay a couple of dollars a week into an All Black Support Fund? Possibly. How about a couple of dollars a week to prop up The Wallabies, England or Les Bleus? Not bloody likely!
And so to the question of NZ pensions.
Contrary to what many believe, pensions in NZ are not paid out of a pot of tax you contributed to during your working life. That’s long gone: the governments you laboured under have spent it.
Your pension right now is paid out from the taxes paid in by today’s workers, of which there are approximately three million, supporting 829,000 retirees.
Looking at the demographic split, currently 83 per cent of these retirees are European/Pākehā, as are 1.9 million, or 68 per cent of the three million workers supporting them but no one is currently objecting much to this imbalance, so all is currently well.
But what’s going to happen over the next 25 years as the ratio of total workers to retirees falls sharply from the current 3.5:1 to an estimated 2.5:1 by 2050 and a much higher number of those workers are non-European/Pākehā?
By 2050, the number of European/Pākehā retirees increases to 945,000 people, but the number of European/Pākehā workers stays roughly the same at 1.9 million and, by then, they will constitute only 50 per cent of the workforce at best.
So, as a non-European/Pākehā taxpayer, you might reasonably ask the question, ‘Why should I support these European/Pākehā pensioners who are not my people. Why can’t they look after themselves?’
This is a political hot potato likely to cause significant social unrest. At the moment no one focusses on it but expect Māori, Indians, Chinese and others to become more and more agitated as the years pass, especially as the politicians representing these ethnic groups sniff an opportunity to win votes.
‘Why should you pay for these old, Pākehā dudes, living large on the pension your taxes are funding? You’re from Mumbai, Shanghai or South Auckland and they never did anything for you,’ is a political manifesto likely to cause more racial unrest and put more pressure on the concept of universal pensions than all of the other factors such as overall affordability and pensionable age that we’re currently worrying about.
