KiwiSaver funds should be allowed the discretion to release savings to people with conditions such as Down syndrome, the Retirement Commissioner Diane Maxwell says.
Currently people can only access their KiwiSaver if they have a terminal illness, buy a first home, or withdraw it at retirement age.
The mother of a man with Down syndrome, Joan Fairhall, is calling for a law change after discovering her son’s KiwiSaver is locked away despite his condition meaning he’s unlikely to reach the age of retirement.
Tim Fairhall, 39, cannot access his $8000 in Kiwisaver until he is 65, but Ms Fairhall said the average age of death for people with his condition was 57.
Ms Maxwell told Sunday Morning KiwiSaver rules should be more empathetic to people with health conditions.
She said a principles-based approach giving KiwiSaver providers discretion to release funds to people such as Mr Fairhall would be a solution.
“It is money he has saved and he wants to withdraw it while he’s still alive and that makes sense, it’s his retirement savings, he just wants to spend it in his retirement,” she said.
Ms Maxwell said there was no easy solution, but the problem could not fall into the too-hard basket.
The Commerce and Consumer Affairs Minister Kris Faafoi said in statement he was sympathetic to Mr Fairhall’s situation.
“KiwiSaver is intended to help people save for retirement – on the whole it is working well and doing what it was designed to do.”
But he said he has not ruled out making changes and a three-yearly review of retirement income policies would take place next year.
“Terms of reference for this will be set by December, so we are certainly thinking about what would be most useful and appropriate as KiwSaver matures,” he said.