Abstract:
The unique approach of New Zealand and Australia to their state age pension provision is derived from an entitlement based on residency. Even so, there are stark differences between the Australian and New Zealand state pensions which raise an important set of issues for movements between these two countries. In an increasingly mobile world, there is more choice of where to live in retirement. Immigrants reaching retirement age in New Zealand may find to their surprise that even after working many years they do not qualify for the age pension, New Zealand Superannuation (NZS). Under Section 70 of the Social Security Act 1964, NZS is offset dollar for dollar by overseas pensions that are deemed analogous. Recent amendments to New Zealand legislation have improved the ability of pensioners to emigrate with their pro-rata entitlements, but have failed to address the very real inconsistencies and inequities for those who stay, and have intensified Trans-Tasman problems. The Australian/New Zealand case is covered by a reciprocal social security agreement for retirees that in some respects appears strongly biased in the favour of Australia. A more general solution to New Zealand’s overseas pension problems may require a sharp increase in residency requirements. In such a framework, the New Zealand/Australia social security agreement would also require renegotiation to ensure consistency and improve choice.