Dr Morgan has launched an attack on the fund, saying the Government's decision to defer contributions for 11 years - announced by Finance Minister Bill English with last week's Budget - had helped seal its fate.
The fund was established by former finance minister Michael Cullen, who wanted to use budget surpluses to pay for the costs of an ageing New Zealand population.
Dr Morgan said the fund had been in line to cover about 14% of the cost of superannuation for baby-boomer retirees by 2040, with taxpayers to pay the remaining 86% of the cost, but deferring contributions meant taxpayers would now pay 93% of the cost.
"Why bother? The reality is the dream is over. Economic circumstances have rendered the Cullen Fund a white elephant, although it was looking increasingly doomed, anyway, before the credit crunch sent the New Zealand Government accounts into a spiral."
He doubted the fund would be able to "catch up" when budget surpluses returned, meaning the fund would be "stuck at about $12 billion to $15 billion - an amount "not large enough to make any meaningful difference" to the future tax demands of superannuation.
Instead, Dr Morgan said the Government should scrap the fund, with the $12.5 billion given back to the public in the form of KiwiSaver contributions, which would see about $3000 added to each person's retirement fund.
He also urged Prime Minister John Key to get into line with the United Kingdom, the United States and Australia by raising the age of entitlement for superannuation from 65 "to 70 or thereabouts".
"The UK has theirs at 68, the US is at 67 and Australia has just announced theirs is going to 67 over the next 14 years.
"Why do we - this highly indebted nation - remain in denial and cling to the lie that it can be maintained at 65?"
• Gareth Morgan runs the Gareth Morgan KiwiSaver Scheme. His analysis of the Super Fund can be read on the ODT's Opinion page tomorrow.
