KiwiSaver schemes provide confusing fee information that's peppered with disclaimers and loopholes.
We wrote about this in our June 2008 KiwiSaver fees report. A Retirement Commission report and an evaluation by three government departments also recommended that the Ministry of Economic Development (MED) change the KiwiSaver fee structure to make it easier to compare costs.
The MED announced it would review how KiwiSaver fees were disclosed and its findings were due in November 2008.
New priorities
There’s still no sign of the report so we contacted MED to see what was happening. The ministry told us that “due to new work priorities it has been agreed that a separate report on KiwiSaver fees will not be provided this year.”
There are now more one million KiwiSavers and over a billion taxpayer dollars are pumped into the scheme each year. According to sorted.org.nz, an individual will spend tens of thousand of dollars on fees during the life of their KiwiSaver investment.
It’s not just us saying there’s a problem. Global fund assessor Morningstar recently rated our fund-management industry – we came bottom of the 16 countries assessed and scored particularly badly for transparency.
Our view
- The government clearly needs to make a more transparent KiwiSaver fee structure a priority.
More information
- Retirement Commission: www.sorted.org.nz
More from consumer.org.nz
- KiwiSaver fees - our June 2008 article
- Managed funds - should we trust our KiwiSaver funds with them?
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