The Minister for Financial Services and Superannuation, Bill Shorten, today introduced legislation to establish a trans-Tasman retirement savings portability scheme.

“The introduction of this legislation represents another important step towards our closer economic relations with New Zealand, and supports progress toward the goal of a single economic market, to which the Australian and New Zealand Governments are both committed,” said Mr Shorten.

“Next year, 2013, is the 30^th anniversary of the Closer Economic Relations Trade Agreement with New Zealand.  That Agreement, together with the single economic market agenda, has brought down trade barriers, reduced costs for business, encouraged investment and created jobs and economic growth for both Australia and New Zealand.”

“This legislation has removed one more barrier to labour mobility between the two countries.  The new scheme will assist the thousands of Australians and New Zealanders who move across the Tasman Sea each year, help them to consolidate their retirement savings in their country of residence and avoid paying fees and charges on accounts in the two countries,” Mr Shorten said.

More than 50,000 New Zealanders moved to Australia in the last year, while about 14,000 people left Australia permanently for New Zealand.

New Zealanders moving to Australia will be able to transfer their KiwiSaver scheme savings to Australia and add them to their Australian superannuation benefits.

Similarly, Australians moving to New Zealand, and New Zealanders returning home, will be able to take their Australian benefits with them, to consolidate with their New Zealand retirement savings.

The scheme may also assist Australian superannuation funds by removing small or inactive accounts belonging to former members now living in New Zealand and no longer contributing to their Australian fund.

The legislation is scheduled to commence on 1 July 2013.

Mr Shorten’s Media Contact: Sam Casey 0421 697 660

 

Key features of the portability scheme include:

• individuals may transfer their retirement savings between an Australian complying superannuation fund regulated by the Australian Prudential Regulation Authority and a New Zealand KiwiSaver scheme;


• participation is voluntary for members and for superannuation funds and schemes;


• retirement savings will generally be subject to the rules in the host country; and


• New Zealand retirement savings transferred to Australia will be treated as non‑concessional contributions and subject to the Australian non-concessional cap arrangements at the initial point of entry.