When I’m 64: What do New Zealanders want in a retirement income policy?

It is difficult to choose policies when people have diverse preferences over outcomes and many alternative policy settings are available. To do this well, policymakers must understand underlying preferences and rank policies according to these preferences. In this paper, we use multi‐criteria decision analysis techniques to understand the relative attractiveness of retirement policy reforms in New Zealand. Using a nationally representative sample, we estimate individual preferences over seven aspects of retirement policy, characterise the diversity of these preferences, and rank three different policy options. We find that a policy which raises taxes to prefund the government retirement income scheme would be supported by a majority of people of all ages and income groups, and would be much more popular than a policy that 1 andrew.coleman@otago.ac.nz, The Department of Economics, University of Otago; joey.au@mbie.govt.nz, Ministry of Business, Innovation and Employment, New Zealand; Trudy.Sullivan@otago.ac.nz, The Department of Preventative and Social Medicine, University of Otago. We would like to thank Diane Maxwell, Malcolm Menzies, Richard Thompson, Kathryn Maloney and Tania Werder at the Commission for Financial Capability for their advice and support while the project was undertaken. Several staff at the New Zealand Treasury assisted in the project. We would particularly like to thank Girol Karacaoglu, Gabriel Makhlouf, Chris Ball, Matthew Bell, Deborah Cuzens, Margaret Galt, Bryan McDaniel and Paul Rodway. We are indebted for the assistance provided by the staff of 1000Minds, Paul Hansen and Franz Ombler, throughout the project and for comments on the paper. We also wish to thank the staff of Colmar Brunton, particularly Leilani Liew, for their help in fine‐tuning and implementing the questionnaire. We are grateful for the time the members of focus groups in Dunedin, Wellington and Auckland spent with us discussing their views, including Atene Andrews and the Hikoikoi Kaumātua group in Petone. Lastly, we wish to thank seminar participants and discussants at the University of Otago, the University of Auckland and the Western International Economics Conference, with particular thanks to Arthur Grimes from Motu. We also wish to thank Matt Benge, Norman Gemmell, Nicola Kirkup, David Law, Trinh Le and Jacques Poot for their helpful comments and suggestions. This project received financial support from the New Zealand Treasury, Wellington, and the Commission for Financial Capability, Auckland, New Zealand. AgendA, Volume 26, number 1, 2019 24 raises the age of eligibility. The results suggest multi‐criteria decision analysis has considerable potential to help policymakers develop policies that are aligned with people’s preferences.