New default KiwiSaver settings designed to benefit members

The Financial Markets Authority – Te Mana Tātai Hokohoko (FMA) notes the Government’s announcement today regarding new KiwiSaver default provider arrangements, these include new settings that offer a package of benefits for default KiwiSaver members.

Finance Minister Grant Robertson and Commerce and Consumer Affairs Minister David Clark have revealed the appointment of BNZ, Booster, BT Funds (Westpac), KiwiWealth, Simplicity and Smartshares (NZX) as default providers for the next seven years, noting they were selected for offering the best value for money for investors.

Rob Everett, FMA Chief Executive, said value for money and fees had been a sharp focus of the regulator’s oversight of KiwiSaver for some time.

“The new default provider settings offer a range of benefits to default investors, including improved outcomes from a balanced fund, lower fees, and services. There is also an obligation to exclude fossil fuel production and illegal weapons from the default funds. Altogether, this is a fair representation of value for money for existing and new default members, sending a strong signal to the market,” he said.

“We will be working closely with Supervisors of current and new default managers to ensure a smooth and robust transition process for affected members and their balances. We’ll continue to monitor the current default providers to ensure they act in the best interests of members through the transition.”

The default provider selection process was undertaken by the Ministry of Business, Innovation and Employment (MBIE) and the changes will come into effect on 30 November 2021. The FMA’s primary role in KiwiSaver is to license, monitor and supervise all KiwiSaver providers, including default providers, and their Supervisors

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