2 Data and Definitions
The data for this study are drawn from the Household Savings Survey conducted in 2001. This survey collected information on the assets and liabilities for unpartnered individuals and couples. From this it was possible to estimate their total net worth.[2] No allowance has been included for human capital. Information was collected about superannuation schemes where the respondent was not yet receiving payments. These schemes could be either a personal scheme (sometimes referred to as retail schemes) or schemes operated through the person’s employer. A person could hold either or both types of schemes. If the respondent was partnered, information was collected separately on the schemes held by each member of the couple.
2.1 Employer (Workplace) Superannuation Schemes
These are schemes (either defined benefit or defined contribution) where the respondent’s employer made a financial contribution to a retirement account held in the employee’s name. Workplace schemes do not include those where the employer merely makes a payroll deduction and facilitates the transfer to an account held by the employee.
In the case of defined benefit schemes, the information was provided to the Government Actuary who made an estimate of the value of the scheme. For defined contribution schemes, the respondent was asked to estimate the value of the scheme if it were cashed in on the day of the interview.[3]
2.2 Personal Superannuation Schemes
These are schemes to which the employer made no contribution. The respondent was asked to estimate the value of the scheme if it were cashed in on the day of the interview.
In summary, information is available from the HSS for the respondent (and the respondent’s partner if in a couple) as to whether they had a personal or employer-based superannuation scheme and if so, its value. It is not possible to identify whether the participation in the workplace scheme was voluntary or whether the enrolee joined at a time when participation was obligatory. Nor is it possible to identify whether the employer of a participant in a personal scheme provided access and facilitated the transfer of contributions through payroll deductions.
Notes
- [2]The term net worth is used to describe the total accumulated wealth of an individual or a couple at the time of the survey. From the HSS we obtained the value of net housing equity, financial assets net of liabilities and the value of pensions (both workplace and personal schemes). The sum of these items is referred to by Statistics New Zealand (2002) as net worth.
- [3]Arguably, this would tend to understate the value of schemes where the member was not fully vested in the employer’s contributions.
