Editorial: KiwiSaver Changes Bring Joy

Thanks to pressure from farmers, the Government has finally come good on a 2023 election pledge to allow young farmers to use their KiwiSaver funds to buy their first home or farm.

A technical change proposed to the KiwiSaver Act by the Government means farm staff in service tenancies (living on farm) will soon be able to use KiwiSaver to purchase a house without immediately moving in.

Not all KiwiSaver providers are happy with the Government announcement. Some say the change is problematic. It could weaken KiwiSaver’s core purpose as a retirement savings scheme and offers only marginal benefits to a small group of people, while impacting millions of members.

But young Kiwi farmers have been incredibly frustrated that they haven’t been able to access their KiwiSaver to help get a foot on the property ladder.

Until now, they could only use your KiwiSaver to purchase a house you’ll live in.

Federated Farmers, which led the push for changes, claims that’s unfair because farm staff, along with the likes of rural teachers and rural police, haven’t been able to get on the property ladder, all because they live remotely and in employer-provided accommodation.

They’ve been denied the same opportunity as their urban counterparts.

The changes will also allow first-time farm buyers to use their KiwiSaver balances when buying through a commercial entity they majority own, provided it will be their principal place of residence.

Many young farmers face financial challenges in buying a farm, having to work hard to save a decent deposit but just can’t get the bank’s backing to invest in their first farm.

Letting those farmers use their KiwiSaver will be an enormous help in pulling together a larger deposit.

It’s taken the Government a long time to deliver on this election promise.

Farmers made sure to keep reminding them about it.

The changes open new doors for many young farmers: they can finally access savings to secure financial security and begin building equity.