KiwiSaver inflows were up 17 per cent in the 12 months to the end of June with contributions hitting $4.8 billion compared to just over $4 billion (up 33 per cent on 2013) during the previous annual period, according to new figures released by the Inland Revenue Department (IRD).
Employer and member contributions made up more than 83 per cent of the $4.8 billion added to KiwiSaver accounts over the 12-month period, the latest IRD annual KiwiSaver statistics show.
While government contributions (kickstart and member tax credit) were up about $65 million year-on-year, the $800 million in subsidies represented just 16.7 pent of total KiwiSaver flows compared to 18 per cent in the year prior.
Since inception, the government has kicked in over $6.6 billion into KiwiSaver, a tad more than 27 per cent of the total $23.9 billion paid into member accounts. The government removed the $1,000 ‘kickstart’ payment for new KiwiSaver members this May, expecting to save $500 million over the next four years as a result.
The IRD figures exclude investment returns but research houses Plan for Life and Morningstar put total KiwiSaver funds under management at about $28.5 billion as at the end of March 2015.
According to the IRD statistics, the KiwiSaver member growth rate also tailed off in the 12 months to June 30 compared to the previous period. Member growth was down in both proportional and nominal terms in the 2014/15 period, adding about 180,000 net new members (up 7.7 per cent) compared to 203,000 (an annual increase of 9.6 per cent) in the preceding year.
Total KiwiSaver membership reached 2.53 million at the end of June, of which almost 119,000 were officially on contribution ‘holidays’ with a handful (260) on financial hardship suspensions.
For the second year in a row the number of individuals who have opted-out of KiwiSaver fell with just 234,232 in that category this June compared to the peak of about 256,00 in 2012. The statistic suggests a substantial number of individuals who had previously opted out during the auto-enrolment process had since joined a KiwiSaver scheme.
Over 26,000 KiwiSaver accounts closed during the year with retirement (roughly 19,000) by far the most common reason.
The IRD figures also put the final tally of scheme transfers (excluding mergers) during the 2014/15 financial year at 157,809 compared to just over 149,000 in the previous period.