The Labour Government is misleading small businesses over the benefits of KiwiSaver, says Nationals Associate Small Business spokesman, Chris Tremain.
Press Release – National Party
Small Business Minister Lianne Dalziel told the Small Business Expo this week that KiwiSaver would have a huge impact on New Zealand capital markets and they would benefit by easier access to finance.
The Minister has not done her homework if she actually believes this to be true.
The reality is that KiwiSaver schemes will largely invest in low-risk portfolios – mainly overseas in blue chip public entities or funds.
She knows very well that the Cullen Fund, for example, has a long-term goal of investing just 7.5% in New Zealand equities and only in blue chip stocks and funds. Very little, if any, of the funds are invested in high-risk private equity or small business.
Does she think KiwiSaver fund managers will be any less prudent?
What she also conveniently forgot to mention was that most small and medium businesses in New Zealand are sole traders, trusts or partnerships that did not receive the benefit of the Budget-announced corporate tax reduction and will therefore have to bear the full cost, after tax credits, of the KiwiSaver employer contribution.
For the Minister to claim that KiwiSaver will benefit small businesses is misleading at best and, at worst, a cruel joke.
The truth is KiwiSaver will not only fail to deliver easier access to finance for small businesses, but it will actually push up the cost of doing business for the majority.