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As people live longer and healthier lives, the period spent in retirement lengthens, increasing pension system costs. Raising the retirement age helps align working years with lifespan, maintaining system sustainability. This matters more now because a larger share of older adults can remain healthy enough to work to 67 than when the age of 65 was first set.
With an aging population and a growing ratio of retirees to workers, raising the retirement age reduces pension payouts and increases contributions, easing fiscal pressure on government budgets.
Encouraging older workers to remain employed longer can mitigate workforce shrinkage due to demographic shifts, supporting economic growth and reducing dependency ratios.
Following international trends suggests New Zealand should adapt similarly to maintain competitiveness and align with global demographic and economic realities.