Hardship forces Kiwis to withdraw $470 million from KiwiSaver in 12 months
'Initially it was about cost of living, when inflation rose very sharply… then of course the recession - when we've seen quite a big set of job losses and that wider hardship.
'[Hardships] used to be under about 2000 a month and we've been closer to 4500 a month in the last little while, so [that] gives you a sense of just how much hardship there is.'
Eaqub said redundancies were the biggest driver of hardship in the past year.
'There's a bunch of reasons, but really it's about that big increase in job losses over the course of the last couple of years.
'While the overall rate of inflation has slowed, the cost of living is still really high. So, what we've seen is the rate of growth… costs are not increasing as fast as before but they're still very expensive. Particularly for things like food.
'Food prices are up around 4.5% [in the last year], people's incomes are not rising that fast.'
Eaqub called it a 'double whammy'.
'When the economic conditions are weak, it tends to affect people in more than one way.
'It's around 0.3% of all KiwiSaver members. So, it's gone up a lot since the pre-Covid years when it was 0.2%.
'It's a small number of people who are experiencing a lot of hardship.'
He said the average amount withdrawn is about $9000.
'[People] are taking out what they can to cover their outstanding debts and making sure they've got money left over,' Eaqub said.
Eaqub said this can have implications on retirement savings later in life.
'I guess it's choosing between financial hardship today versus financial hardship potentially later. And that's the trade-off that you have to make.
'If you're in hardship today, then it is no good saying that in 20 or 30 years time I'm going to have a better retirement if you're living in poverty today.
'Quite often we're talking about people who have relatively small balances.'
Those contributing to KiwiSaver were also better insulated for when hardship hits.
'Quite often the people who don't [contribute] are on low incomes. And for them they are missing out on the employee contributions, the Government contribution.
'Those people who have been contributing to KiwiSaver are better off in the sense that, at least they have these pre-cautionary savings and they've saved a lot more income they might have otherwise had.
'So, they may not have more money in retirement but they will at least have more money in hardship today.'
Cameron Smith is an Auckland-based business reporter. He joined the Herald in 2015 and has covered business and sports. He reports on topics such as retail, small business, the workplace and macroeconomics.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NZ Herald
20 minutes ago
- NZ Herald
Independent experts sharing data about Venezuela's financial crisis are being detained
The Central Bank of Venezuela for years has not released reliable data on key indicators like inflation, leaving economists to fill the gaps with independent estimates. 'It's kind of like the Tinkerbell theory of economics,' he added, referring to Maduro's effort to squelch any bad economic news. 'If you believe in her, then her light continues to shine.' The Government's campaign has rattled economists and others behind financial information websites. Even those who live abroad are afraid to speak publicly, fearing reprisals against their families or employees. Among the economists who have been detained is a former finance minister and economics professor, Rodrigo Cabezas, 69, who once served in the governing party but later distanced himself and criticised Maduro's economic policies. Cabezas' daughter Rodna Cabezas said in an interview that on June 3, officials from the state energy company arrived at their home in Maracaibo, in northwestern Venezuela, claiming there was a problem with the electricity. They asked her father to accompany them to resolve it. But then she said her father called her, saying that it had been a trap and that intelligence agents were detaining him. His family has not heard from him since, nor received any information from the Government. 'We don't know where they took him,' Cabezas said. Vendors at the Mercado de Coche, a huge wholesale produce market, in Caracas. Photo / the New York Times The family has hired a lawyer who has also been unable to contact him. Her father needs daily medication for high blood pressure, she said. 'It's very hard,' she said. 'I don't have tears anymore from crying so much. It's like a permanent knife in my heart.' Venezuela's economy imploded a decade ago, driven by government mismanagement and exacerbated by US sanctions. As hyperinflation surged to 300,000% and the local currency, the bolivar, rapidly lost value, Venezuelans began keeping their savings in US dollars. The Central Bank of Venezuela sets an official exchange rate for the bolivar, but most people rely on an unofficial rate called the parallel dollar, published by websites like Monitor Dólar, that reflects what dollars actually sell for on the street. The official rate has often made the bolivar seem slightly stronger than it really is, creating a more favourable picture of the economy. But inflation is surging, analysts say, causing the bolivar to lose value and leaving Venezuelans who are paid in the local currency struggling to exchange it for dollars. 'The dollar-bolivar exchange rate is one of the key variables that the Government is trying to keep a handle on,' Gunson said. He said the Government believes it can stop the bolivar from losing value by silencing people like economists who report on the unofficial exchange rate. And precise inflation figures are no longer available because the Government does not publish such data and has gone after independent economists who do. Other countries in the region like Argentina have been accused of manipulating economic data in times of crisis. Experts say the crackdown in Venezuela on economists and independent financial groups reflects a broader strategy by the Maduro Government to suppress data and silence dissent in order to manage public perception. The Venezuelan Government has not released official statistics on epidemiology since 2016 and has kept data on rising child deaths from hunger a closely guarded secret. Under President Joe Biden, the US relaxed oil sanctions that helped decimate the country's finances in the hopes of prodding the Government into holding free and fair elections. As inflation eased, everyday products became easily available and more affordable, and poverty started decreasing. But last year, Maduro declared victory in an election widely seen by many governments, including the US, as fraudulent. President Donald Trump has since imposed renewed sanctions and revoked a key licence for Chevron to operate in Venezuela, whose economy is heavily dependent on oil. The country's economic tailspin has left many Venezuelans weary and with little faith that the Government can find a solution, analysts said. The financial district in Caracas. Photo / the New York Times According to the human rights group Provea, at least five economists were arrested from May 29 to June 5. Some were released, but two, including Rodrigo Cabezas, remain missing, with no information provided on their whereabouts or the charges they face. At least 20 people linked to Monitor Dólar were detained for reporting on the parallel dollar, according to Maduro's top deputy and Interior Minister, Diosdado Cabello. Cabello, on his weekly television programme, denounced economists 'who are saying the bolivar is worthless — these people are playing with fire'. Authorities, he added, were pursuing 'disguised consultants' who were fuelling financial instability. But the Venezuelan Finance Observatory, an independent group that publishes data on the country's economy, said that 'it is not a crime to compile and disclose price figures'. Financial websites like Monitar Dólar and the cryptocurrency platform El Dorado — where people buy cryptocurrency using bolivars to exchange for dollars — have shut down in response to government pressure. 'I take responsibility for any negative impact generated by the app,' a founder of El Dorado, Guillermo Goncalvez, said in a video. The plight of Cabezas and the other missing economist is a familiar story to human rights activists. In recent years, it has become common for Venezuelan authorities to detain people and hold them indefinitely at undisclosed locations with no contact allowed with family members or lawyers. 'Nowadays, nothing surprises us,' Gunson said. 'There now appear to be no rules. The law, the constitution, nothing counts anymore.' This article originally appeared in The New York Times. Written by: Genevieve Glatsky Photographs by: The New York Times ©2025 THE NEW YORK TIMES
The Spinoff
an hour ago
- The Spinoff
How the NBL's newest team fell apart in one season
A new Spinoff investigation reveals how a high-profile attempt to bring Indian basketball into New Zealand's top league ended in chaos and walkouts, writes Catherine McGregor in today's extract from The Bulletin. A short, unhappy season ending in disaster On May 22, the Indian Panthers withdrew from New Zealand's National Basketball League, officially ending a season that had already been suspended over 'sufficiently serious' allegations. The franchise had been hyped as a groundbreaking move to connect Indian basketball with the NZ sporting scene by creating an Auckland-based team backed by India's own pro league. Instead, it managed just nine games and zero wins while staff and players cycled in and out. Head coach Miles Pearce quit after game one and key overseas players never arrived; by the time players boycotted a scheduled fixture in late April, the project was effectively over. The remainder of the 2025 season, which ended on Sunday, was contested by the league's 11 remaining teams, with all Panthers results scrubbed from the record. No training, no plan As reported in a major investigation by James Borrowdale in The Spinoff this morning, many of the team's on-court problems stemmed from its operational disarray. Veteran player Leon Henry, lured out of retirement to captain the Panthers, describes a team without a training programme or any apparent strategic oversight. There were no full scrimmages, no team meetings and no organised off-court conditioning. 'In lieu of training, the team would merely assemble at the venue a couple of hours before a game to do what they could as they awaited tip-off,' James writes. When interim coach Jonathan Goodman took a holiday mid-season and neither CEO Parveen Batish nor GM Arran Batish returned from Melbourne in time for the next match, players were left to run the team themselves. The Panthers were repeatedly thrashed – by margins approaching 50 points – and never showed signs of improvement. Unpaid wages and walkouts: the downfall of the NBL's Indian Panthers A litany of money problems Behind the scenes, finances unravelled just as fast. Borrowdale's story paints a picture of systemic non-payment: of players, support staff and suppliers. Three Indian imports lived in an Airbnb with insufficient funds for food, relying at times on charity and rival clubs for help. Local suppliers were also burned. The Herald's Benjamin Plummer reported in May that small merchandising company Pure Athletic was chasing $21,000 for t-shirts, while Makers Merch had gone to the Disputes Tribunal over unpaid invoices. Speaking to Borrowdale, Batish admitted the organisation had been 'slow at making some payments' and blamed the cashflow issues on sluggish sponsorship uptake and the Indian community's lack of early support. He insisted all debts would be repaid, but many of those owed – including some players – remain unconvinced. A lack of Indian players exacerbated team's problems Part of the difficulty in building community support may have stemmed from the team's failure to reflect its own identity. The 'Indian' Panthers fielded just three Indian players all season, with the rest of the squad made up of local journeymen and short-term fill-ins. Most of the Indian contingent never received visas, and some reportedly declined to travel once word of conditions in New Zealand reached them. Basketball veteran Jeff Green told Newstalk ZB the franchise's purpose was never truly about long-term participation in the New Zealand league. Instead, he believes it was a 'Trojan horse' aimed at securing a back-door entry into the more lucrative Australian NBL – a theory supported, he said, by the fact that the Panthers' financial backers were all based across the Tasman. If that was indeed the plan, it now lies in ruins.
Newsroom
3 hours ago
- Newsroom
Introducing the Who Benefits project – a spotlight on lobbying, influence and power
Tomorrow, Newsroom unveils the first story in Who Benefits, a year-long project, supported financially by a grant from The Integrity Institute, tracking and disclosing lobbying and influence. It's a new way for Newsroom readers to experience some of the country's best reporting, on politics and public policy. In a series of stories, we will get behind decisions that affect us all but benefit certain sectors, groups or companies above others. Who's getting what they want from our decision makers, how are they organising and what have they achieved? In short, who benefits, or 'cui bono'. We begin on Thursday with a look at the farming lobby, given Government links to the Agri sector and a veritable flood of policy changes, including a consultation on freshwater that finishes this weekend. There's much the public doesn't know, much policy agitation that has come to fruition or is about to, all brought together in one news feature. Then, new sectors and new policy lobbying will be examined over the next 12 months with substantive reports published here on Who's getting their message through to those in power, and getting results? Illustration: Getty Images. This project is a different way of working for us, but our same principles apply. Newsroom often stands back and takes time to analyse, investigate, and explain. With Who Benefits, we've got more time to delve, and breathing room to piece together the puzzle. Our aim is to inform, reveal but never bore – although we will ensure we provide the detail; the receipts. Hang on, though. Isn't Newsroom the subject of influence by accepting a grant from The Integrity Institute? Well, the institute partnership has provided funding, has suggested some places to look, but Newsroom has developed the subject areas, will be led by what we uncover and will retain full editorial control. Our team – Fox Meyer and me, David Williams – are reporting to Newsroom's co-editors, not the institute, and we aim to show influence from all sides of policies. There's pressure on us to perform. While the narrative about the media is one of commercial woe and decline, great journalism is being done every day. Our best moments, as journalists, come when we can ask questions to which we already know the answer. We can't do this alone. We can do even better with your help. If you know where influence is being brought to bear, let us know and we'll take a look. You can email me in total confidence: trublenzOIA@ Find out more information about The Integrity Institute and its mission, here.
