KiwiSaver’s Missing Worker: The Poor Bastard Who Employs Himself
New Zealand loves the self-employed right up until someone designs a policy.
Then suddenly the builder, designer, contractor, consultant, hairdresser, café owner and bloke fixing your gutter are treated as a strange financial species that should apparently pay themselves wages, employer contributions, holiday pay, sick leave, ACC, tax, insurance and possibly a small orchestra.
Employees get KiwiSaver contributions from their employer.
The self-employed get a stern pamphlet reminding them to contribute more.
Brilliant.
The problem is not that self-employed people are irresponsible. The problem is that their income arrives unpredictably, usually after everyone else has been paid. In a bad month, retirement planning comes somewhere below wages, GST, rent, fuel, stock, tax and not having the bank repossess the espresso machine.
Forcing them into an employee-style compulsory scheme is lazy policy. A sole trader cannot magically create an employer contribution by moving money from the left pocket to the right pocket and calling it economic reform.
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