KiwiSaver and the 2026 Election: What Could Change for Employers and Members?

KiwiSaver has been largely stable since its introduction in 2007. The employer minimum contribution has sat at 3% since 2013. The government's annual member tax credit — $521 for those who contribute at least $1,042 per year — has not changed in years. And membership, while high, is still not compulsory.

The 2026 election could change all of that. Two of the three left-leaning parties have specific KiwiSaver policies that would increase costs for employers and change the scheme's structure. Here is what is on the table.

A quick recap of the current KiwiSaver rules:

• Employee minimum contribution: 3% of gross salary (employees can choose 3%, 4%, 6%, 8%, or 10%)
• Employer minimum contribution: 3% of gross salary (compulsory for all eligible employees)
• Government member tax credit: Up to $521 per year for members who contribute at least $1,042
• Membership: Opt-out (new employees are automatically enrolled but can opt out within 8 weeks)
• First home withdrawal: Available after 3 years of membership
• Retirement withdrawal: Available from age 65

National has no plans to change KiwiSaver. The party's position is that the scheme is working as intended and that increasing employer contributions would be a de facto payroll tax on businesses.

What it means for employers: No change to your 3% employer contribution obligation. KiwiSaver costs stay where they are.

What it means for members: The current structure stays. Government member tax credit remains at $521.

Labour has signalled it wants to increase the minimum employer KiwiSaver contribution rate — from 3% to a higher rate, phased in over time. The party has not published a specific schedule for this election, but previous Labour policy documents have pointed toward a 4% employer minimum as a near-term target, with a longer-term goal of reaching 6%.

For employers, this is a direct payroll cost increase. The impact depends on your workforce:

For a business with 10 employees averaging $70,000, moving from 3% to 4% employer contributions adds approximately $7,000 per year to your payroll costs. At 6%, that becomes $21,000 per year.

Labour would likely phase the increase in over several years — as the original 3% rate was phased in from 1% between 2007 and 2013. But the direction is clear.

What it means for employers: Model the cost impact on your payroll now. If Labour wins and moves on this, you will want to understand the effect on your wage budget and pricing.

What it means for members: Higher employer contributions mean more money going into your KiwiSaver account. For employees, this is a genuine benefit — though some economists argue employers offset contribution increases through lower wage growth over time.

The Greens want to make KiwiSaver compulsory — removing the opt-out option for new employees. The party also supports higher contribution rates and has backed Labour's employer contribution increase proposals.

Making KiwiSaver compulsory would affect a relatively small number of workers — KiwiSaver membership is already around 80% of the eligible workforce. But the remaining 20% who have opted out (often lower-income workers, the self-employed, or those with specific financial circumstances) would lose the choice to stay out.

For employers, compulsory KiwiSaver means no more opt-out administration — every eligible employee is in, full stop. The compliance simplification is minor, but the cost implication is the same as Labour's contribution rate increase.

What it means for employers: If you currently have employees who have opted out of KiwiSaver, compulsory membership would require you to start making employer contributions for them.

What it means for members: If you have opted out of KiwiSaver, a Labour-Greens government could require you to re-enrol. There would likely be hardship exemptions, but the default would change.

ACT supports keeping KiwiSaver voluntary and has previously proposed making it more flexible — allowing members to access funds in hardship situations more easily, and reducing the regulatory burden on providers.

ACT would oppose any increase in employer contribution rates, framing it as a tax on employment.

What it means for employers: No change under ACT influence. The 3% employer minimum stays.

One area where all parties agree there is room for improvement is KiwiSaver for the self-employed. Currently, self-employed people can contribute to KiwiSaver but are not required to, and there is no employer contribution — they are both the employer and the employee.

Labour has previously proposed extending some form of employer contribution obligation to the self-employed, though this has not been a prominent policy for this election. The Greens support it in principle.

For self-employed business owners, this is worth watching. A requirement to make employer-equivalent contributions to your own KiwiSaver would be a new cost — but also a forced retirement savings mechanism that many self-employed people currently lack.

Model the cost impact of a 4% employer contribution rate. Run the numbers on your current payroll. Understand what a 1% increase in employer contributions costs you annually — it is a straightforward calculation and gives you a clear picture of your election risk.

Review your employment contracts. Some employment agreements specify employer KiwiSaver contributions above the minimum. If you are already at 4% or above, Labour's policy change would not affect you.

Consider your pricing and wage strategy. If employer contributions increase, you will need to decide whether to absorb the cost, adjust wages, or pass it on through pricing. Having a plan before the change happens is better than reacting to it.

Check your contribution rate. If you are contributing at the 3% minimum, consider whether increasing to 4% or 6% makes sense for your retirement goals — regardless of the election outcome.

Claim your member tax credit. If you contribute at least $1,042 per year, you are entitled to the $521 government contribution. Many members miss this because they contribute through payroll and do not realise they need to top up to the threshold. Check your balance before 30 June each year.

Understand your fund type. The tax treatment of KiwiSaver funds (PIE tax rates) is separate from the contribution rules and is unlikely to change regardless of the election. See our post on KiwiSaver and tax for more detail.

If you want to understand how the election could affect your payroll costs or your personal KiwiSaver strategy, get in touch.

Related reading: KiwiSaver and Tax: What Every New Zealander Should Know | NZ Election 2026: What Each Party's Tax Policy Means for Business Owners | How Much Tax Do I Pay in NZ?