When climate change and other emergencies threaten where we live, how will we manage our retirement?

Although they live in dynamic environments and face an uncertain future due to climate change, New Zealanders generally expect their land and property rights to endure indefinitely.

But few things stay the same. As last week’s offshore earthquakes and tsunami warnings reminded us, our coasts and those living nearby are vulnerable to a host of dangers. These risks will only increase with rising sea levels due to climate change.

The government has announced that the Resource Management Law will be replaced by three new laws, including a Law on Managed Pensions and Climate Change Adaptation. The writing is on the wall: planners and communities must prepare for change.

For those who live in high-risk locations, a managed retirement may be necessary to save lives and ensure public safety.

These “managed retreats” – from low shores vulnerable to sea level rise, areas that regularly flood and unstable or exposed lands – can be a bitter pill to swallow. Especially in the midst of a national housing crisis and a global pandemic.

But the impacts of climate change are already being felt and will exacerbate natural risks in the future. Some existing developments are already proving to be untenable, exposing people and the things they hold dear to serious harm.

It is therefore imperative to include the option of managed retirement in adaptation planning for communities most at risk.

What are managed pensions?

Basically, managed pensions involve the strategic relocation of people, assets and activities to reduce risk.

For obvious reasons, retreats require difficult sacrifices for individuals, families and communities. The process can involve a range of mechanisms, including the provision of risk maps, official notices on Land Information Memoranda (LIMs), development restrictions, and financial incentives to relocate.

Planners and academics have called for a national managed retirement strategy, and the change in law offers a unique opportunity.

In addition to the mandatory purchasing powers used for public works, Aotearoa New Zealand could be the first country to develop specific legislation for managed pensions. The world will follow with interest.

Managing retreats sensitive to people’s dislocation from their homes, livelihoods, landscapes and culture is a challenge. Drafting the new legislation will involve tough decisions about why, when, how and where to retire – and at whose expense.

Put people first

However, how these pensions will be managed remains to be determined. Our latest research examines who manages pensions and how. It is an opportune signal to examine the broad policy options and the implications for planning.

The proposed legislation provides an opportunity to transform land use patterns in Aotearoa, New Zealand. But as we have seen in Canterbury, Matatā and elsewhere, how managed pensions are managed is very important to those affected.

Currently, locally managed retirement interventions are risky – professionally, politically, financially, culturally and socially. Planning frameworks and the necessary resources are rarely available to support effective and equitable results.

Some communities exposed to climatic hazards and perils also face the risk of poor adaptation – paradoxically, their vulnerability is increased by inaction or misguided efforts.

Who manages pensions and how?

Our research distinguishes three approaches to developing policies for a range of possible pensions. Basically, these are:

1. government control: using laws, standards, policies and regulations, central or local government may restrict certain developments or compulsorily acquire property to enforce withdrawal
2. Cooperative-run pensions: collaborative decision-making and negotiation between government agencies and stakeholders, using instruments such as opt-in buyouts, relocation subsidies or land swaps
3. unmanaged pensions: individual choices influenced by factors such as loss of insurance coverage and other market changes, decisions not to invest more in real estate or to sell it (potentially at a loss), or to stay put and face the risk

Using our framework, we consider the risks and implications of each form of retirement. We build on decades of lessons learned from international practice in disaster resettlement and planned relocation.

Make the right law

Basically, we argue that it is better to facilitate pensions run by cooperatives. This means that people and communities are included in the design, decision-making and delivery of the retirement strategy.

It is therefore imperative that flexible, collaborative and responsive policies and practices are important. To manage expectations regarding at-risk, transitional and marginal lands, it is also necessary to regulate new development or land use (for example by placing time limits on consents).

Managed, cooperative and unmanaged pensions each have a role to play. But their associated policy practices and interventions must be strategically planned. To promote public safety, justice and fairness, cooperation must be at the heart of the management of resettlement.

Aotearoa New Zealand has the potential to foster long-term resilience in the face of climate change and many other land use challenges. Determining who manages pensions, how and who pays is an important job.

The form of the new legislation – the processes and results it promotes – will influence the lives and well-being of present and future generations.

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