The Public Service Association has claimed that National's compulsory KiwiSaver policy carries a hidden multibillion-dollar cost for schools, hospitals and other public services.
National announced at its annual conference in June 2026 that KiwiSaver would become compulsory from July 2028, with both employee and employer contributions rising steadily to 6% by 2032.
PSA national secretary Fleur Fitzsimons told RNZ that National had not been upfront about the true cost. She claimed National had calculated only what it would take to enrol workers not yet in the scheme, while leaving out the expense of raising payments for those already participating. The union's analysis placed the unfunded expense at $4.5 billion across the 5 years from 2028 to 2033, using Treasury wage projections and a constant workforce size.
"It is irresponsible and a dereliction of duty not to properly fund election promises," Fitzsimons said. "We need to see transparency from this government about what public, community and health services they'll cut in order to fill this hole."
National finance spokesperson Nicola Willis responded to the PSA claims, saying departments would be expected to plan ahead for the larger payments and the extra expense could be accommodated through prudent allocation in coming budgets. She said any extra cost would be "partially offset by increases in employer superannuation tax contributions".
Willis said "the additional cost will be able to be met from within future budgets so long as the government continues to carefully prioritise public money". She described the union's position as disappointing, saying "I'm surprised the PSA doesn't see providing its members with greater financial security in retirement as a priority. National does."
At the 2025 Budget, when the government announced initial KiwiSaver changes, Treasury forecast that employers would recoup approximately 80% of the expense by delivering smaller wage increases.