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John Horner: Financial Markets Authority director on KiwiSaver funds breaking $100 billion mark · The SME Stream

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  Speaker 1: Now can we save? Our investments have hit a new milestone,
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  Speaker 1: topping over one hundred billion dollars for the first time
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  Speaker 1: in New Zealand. The amount of money in managed funds
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  Speaker 1: has increased by nineteen percent, and what that means is
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  Speaker 1: that sixty two percent of us are now invested in
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  Speaker 1: a Key we Save a fund. John Horner is the
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  Speaker 1: director of the Financial Markets Authority. Hey, John, Hi, is
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  Speaker 1: there a particular reason why our Key we Save investors
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  Speaker 1: investments have jumped up that much in just a year.
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  Speaker 2: Look, it's probably a bounce back from the prior year
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  Speaker 2: where returns on investment we're negative. So we always look
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  Speaker 2: at these things long term. Great to see a bounce back,
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  Speaker 2: but that's the long term accounts.
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  Speaker 1: What do you make of the number of withdrawals or
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  Speaker 1: the value of the withdrawals?
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  Speaker 2: Possibly a sign of the times that says cost of
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  Speaker 2: living challenges, that's difficult economic conditions, and so it's probably
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  Speaker 2: Key We Saver working as it was designed to allow
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  Speaker 2: those withdrawals to happen.
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  Speaker 1: How much okay, so how much of the money that's
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  Speaker 1: being withdrawn is being taken out to basically just pay
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  Speaker 1: the bills?
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  Speaker 2: We won't know the reasons and for or for the withdrawals.
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  Speaker 2: I mean, hardship applications. It's quite a high threshold. It's
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  Speaker 2: not a matter if I can't pay my bills just now,
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  Speaker 2: but it's quite a significant threshold to overcome. That's dealt
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  Speaker 2: with by the supervisors SABER providers. They assess the hardship
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  Speaker 2: applications and make those decisions.
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  Speaker 1: Yeah, just off the top of my head, it was
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  Speaker 1: something like five billion that's been taken out in the
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  Speaker 1: last year.
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  Speaker 2: Yeah, I think that's right. Yeah, five billion was drawn
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  Speaker 2: by members and so that'll also be your over sixty
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  Speaker 2: fives as well. So they're the ones who are actually
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  Speaker 2: using their kiwisaver in their.
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  Speaker 1: Retirement, right, And the key we say, sorry, the over
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  Speaker 1: sixty fives actually make up the vast majority of that
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  Speaker 1: about three billion. But how do we know they don't
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  Speaker 1: need it for hardship.
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  Speaker 2: Well, they can use it for whatever reason they like, right,
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  Speaker 2: So you're right. I mean, if you're in your retirement,
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  Speaker 2: kevsaver is all about your financial wellbeing and your retirement years.
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  Speaker 2: Some of those folks will still be working, maybe part time,
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  Speaker 2: maybe full time, but TV taper is available for them
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  Speaker 2: to use as they wish and so I.
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  Speaker 1: Suppose we can't break it out and look at how
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  Speaker 1: many of them are taking it up because they're leaving
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  Speaker 1: the country altogether or anything like that.
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  Speaker 2: Can we look the numbers are as reported? There's an
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  Speaker 2: also a lot of numbers in there, so I can't
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  Speaker 2: speak to all of them. But yeah, the withdrawals that
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  Speaker 2: the headline figures for the withdrawals is the number week
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  Speaker 2: we focus on.
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  Speaker 1: What do you make of only sixty two percent of
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  Speaker 1: us being invested in key we save a fund. I
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  Speaker 1: suppose glass half full. That's not a bad number, but
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  Speaker 1: glass half empty, there's still a fair chunk of us
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  Speaker 1: who aren't invested.
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  Speaker 2: That's right. We'd always like it to be more, and
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  Speaker 2: obviously like the members who are part of ki we
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  Speaker 2: Sabor to be contributing. But again, relative to the times
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  Speaker 2: we're going through at the moment, we think the contributions
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  Speaker 2: have held pretty steady. We'd always like those who have
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  Speaker 2: cysed to make contributions to come back and start those
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  Speaker 2: again just as soon as they can.
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  Speaker 1: John most people are in growth funds.
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  Speaker 2: Now.
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  Speaker 1: Does that reflect the age of the investors that they
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  Speaker 1: are of a younger profile or is this something else
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  Speaker 1: going on here.
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  Speaker 2: Maybe not so much the age, more the investment horizon
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  Speaker 2: that they're looking at as their long term investment. They've
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  Speaker 2: got a long term horizon sort of ten years and plus.
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  Speaker 2: Then growth funders most likely to be the right fund
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  Speaker 2: for them.
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  Speaker 1: John, it's good to talk to you. Thank you very much,
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  Speaker 1: really appreciated John Horner, Director of the Financial Markets Authority.
• 3:28
  Speaker 1: Hither can you please look into the realized that agents
• 3:30
  Speaker 1: losing their licenses for not completing the Maori cultural courses. Yes,
• 3:34
  Speaker 1: I'm going to raise that with you. You're going to
• 3:35
  Speaker 1: hear this. You're going to have to hear this. The
• 3:37
  Speaker 1: old Fletcher Building thing seems to be an old albatross
• 3:41
  Speaker 1: hanging around some people who are associated with its next
• 3:44
  Speaker 1: at the moment, A Bruce Hassel may buff may be
• 3:47
  Speaker 1: regretting that he ever had anything to do with it.
• 3:49
  Speaker 1: He was the chair of Fletcher Building. He has now
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  Speaker 1: just withdrawn his nomination for election to the Victor Board
• 3:55
  Speaker 1: completely unrelated, but has decided to withdraw his nomination for
• 4:00
  Speaker 1: election because feedback from shareholders, obviously when it was not
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  Speaker 1: very positive about his previous role as the chair of
• 4:07
  Speaker 1: Fletcher Building. The Victor's current chair Doug mckaye's expressed disappointment
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  Speaker 1: on behalf of the board said Hassel had made you know,
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  Speaker 1: significant contributions since he joined last October and blah blah blah,
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  Speaker 1: and he had the unanimous support of his board colleagues,
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  Speaker 1: but unfortunately the shareholders don't love it, and so he's
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  Speaker 1: out twelve past six