4 May 2014

Cunliffe says policy will be peer-reviewed

10:11 am on 4 May 2014

Labour leader David Cunliffe says the party's newly announced monetary policy will be internationally reviewed.

David Cunliffe.

David Cunliffe. Photo: RNZ

On Tuesday, the party said that if elected, it will make KiwiSaver compulsory and consider raising contribution levels to keep interest rates down.

Mr Cunliffe told the Sunday Morning programme the policy is reasonably world leading.

He said it has been well tested by a range of people, including former ministers, former Reserve Bank board members, as well as economists.

Mr Cunliffe said Labour is getting the policy peer-reviewed, but he was confident of its robustness.

With compulsory savings, introduced gradually as wages go up, he said people will have more money in the pocket and in the bank.

Comment by Brash

Former National and ACT leader Don Brash says Labour's new monetary policy has some merit.

Dr Brash, who's also a former Reserve Bank governor, says he agrees with Labour that the Reserve Bank needs a new tool, to go with its ability to raise or lowering of interest rates.

On TVNZ on Sunday, Dr Brash said it was sensible to try and take the pressure off interest rates, although he was not sure the idea would work.

He said he did not favour compulsory retirement savings as young people would be better paying off their mortgage than putting money into managed funds.