Outgoing National MP Andrew Bayly is calling for New Zealand’s superannuation age to begin rising from the next parliamentary term, arguing that continued delay will make future reform more severe. His proposal would increase eligibility by one month each year from 2029, eventually lifting the age from 65 to 68 by 2065.
eLocal Report: Based on reporting by Craig McCulloch for RNZ HERE
Andrew Bayly is using his final weeks in Parliament to push one of New Zealand politics’ most difficult long-term questions back onto the agenda: how much longer can the country afford to keep universal superannuation eligibility fixed at 65?
Bayly says the answer is that reform needs to begin soon, and gradually.
His proposal would increase the eligibility age by one month every year from 2029, eventually reaching 68 in 2065. He is also proposing slower increases in the dollar value of NZ Super and a limited pathway for some people to access it earlier at a reduced rate if poor health, lower life expectancy or physically demanding work prevents them remaining in employment.
The proposal comes from a research paper Bayly co-authored with economist Leonard Hong and data analyst Emmanuel Jo, published in the International Review of Public Administration. Bayly told RNZ the work represented his own view rather than National Party policy.
A Growing Share of the Tax Base
The central argument is fiscal.
Bayly and his co-authors estimate that under current settings, superannuation could consume almost 30 cents of every dollar of government tax revenue by 2065, compared with about 19 cents today.
They further estimate that superannuation, health and education combined could absorb nearly 80 percent of tax revenue by then.
Bayly described the trajectory as a “freight train coming down the line”, arguing that delaying change risks forcing a future government into much harsher measures during a fiscal crisis.
His preferred solution is deliberately incremental.
Rather than raising the pension age by several years in a relatively short period, the one-month-per-year approach is designed to spread the adjustment across generations and give future retirees more certainty about when they will qualify.
National’s Existing Position Falls Short, Bayly Says
National campaigned in 2023 on gradually raising the superannuation age to 67.
The party initially proposed beginning those changes in 2037, before later pushing the starting point back to 2044.
Bayly considers that plan insufficient.
According to the modelling cited by RNZ, National’s previous policy would reduce superannuation’s share of government tax revenue to about 26.5 percent by 2065. Beginning the adjustment in 2029 would reduce that further to about 25 percent.
National has not yet detailed its superannuation policy for the 2026 election.
Slower Payment Growth Also Proposed
Changing the eligibility age is only one part of the proposal.
Bayly also argues that NZ Super should be treated more like other welfare payments by linking future increases more closely to general inflation rather than wage growth.
That would mean pension payments would still rise, but more slowly than under current settings.
He has suggested regular reviews to ensure retirees do not fall too far behind the wider population.
This part of the proposal could prove just as politically significant as the change in eligibility age because it would affect not only when people receive superannuation, but how quickly the value of that payment grows over time.
An Early-Access Safety Valve
One of the strongest objections to raising the pension age is that not everyone has the same ability to continue working.
A 67- or 68-year-old office worker may be able to remain employed longer than someone who has spent decades in physically demanding work. Average life expectancy and health outcomes also differ substantially across population groups.
Bayly’s paper attempts to address that by proposing an early-access option for people with reduced capacity to work, lower life expectancy or physically demanding occupations.
Those people could receive superannuation earlier, but at a lower rate.
The authors argue that such a mechanism could make reform fairer and more politically durable.
They also support compulsory KiwiSaver contributions and continued payments into the NZ Super Fund.
Voters Still Prefer 65
The political difficulty is clear.
An RNZ-Reid Research poll in July found 58 percent of voters wanted the superannuation age to remain at 65, while 35.3 percent supported increasing it to 67 and 6.8 percent were unsure.
Interestingly, the same poll found greater support for means-testing NZ Super, with 46.6 percent in favour and 40.7 percent opposed.
Bayly’s paper rejected means-testing as politically too difficult to achieve across Parliament.
Treasury forecasts cited by RNZ show the annual cost of superannuation rising from $24.7 billion this financial year to $31.2 billion in 2029/30.
That fiscal pressure will continue regardless of whether politicians choose to address the eligibility age.
Political Parties Remain Divided
The major parties remain far apart on what should happen next.
ACT previously campaigned on increasing the super age to 67 more rapidly, by three months a year.
New Zealand First remains opposed to changing access to current entitlements.
Labour and the Greens support retaining the age at 65, while Te Pāti Māori has argued Māori should be able to access superannuation earlier because of lower average life expectancy.
That division makes the cross-party agreement Bayly is seeking difficult.
But it also underlines his argument: because superannuation reform affects people decades into the future, major policy changes become harder if successive governments repeatedly change direction.
The Real Question Is Who Pays
Bayly’s proposal ultimately puts an uncomfortable question in front of voters.
New Zealand Super is not funded from an individual retirement account built up specifically for each recipient. Its cost is borne through the wider public finances.
As the population ages and the ratio between working taxpayers and retirees changes, governments must decide whether to increase taxes, reduce other spending, borrow more, slow pension growth, change eligibility, or adopt some combination of those options.
Bayly’s position is that gradual adjustment now is preferable to a more severe correction later.
Whether voters agree is another matter.
The polling suggests most New Zealanders still regard 65 as a line they do not want governments to cross.
That leaves the country with a growing fiscal problem and no clear political consensus about how to solve it.
Source: Craig McCulloch, RNZ, “Super at 68? Departing National MP calls for pension age to start rising in 2029.”
Independent reporting. Original context. Credited sources.