He told the Workplace Savings conference last week that governments don't know how to increase national savings.

"Let me make it quite clear that KiwiSaver is a wonderful scheme for savers – the subsidies from the government are so generous that if you’re a New Zealand resident under the age of 65 and don’t belong to a KiwiSaver scheme you don’t understand it," Brash said.

"But does KiwiSaver increase national saving? Almost certainly not."The only study I’ve seen suggests that KiwiSaver has probably increased private sector saving to a very modest extent – most of the private contributions coming not from reduced spending but from a diversion of saving from other areas – but at the cost of very substantial dis-saving by the government, because of the scale of those subsidies," he said.

However AMP chief economist Bevan Graham disagreed with Brash.

He said one of the good things is that KiwiSaver is starting to engender the culture of savings in New Zealanders.

That point was supported by Raewyn Fox, the chief executive at the NZ Federation of Budgeting Services.

She said her members had seen that KiwiSaver was helping people who attended budgeting services develop a savings habit.

Graham said the government spending on KiwiSaver, through mechanisms like the Member Tax Credit (MTC), has been worth it to get a savings culture started.

The government halved the MTC in this year's budget and Graham expects this to be the start of a cutback trend.

He warned delegates more such changes will happen.