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The Latest On Superannuation

The Latest On Superannuation

Tags: Superannuation
Last updated by Kayley Harris on

SUPERANNUATION

Back in July after the Coalition won the Federal Election our own Christopher Zinn sent a letter to the PM on behalf of the FiftyUp Club. In it, Chris described the results of our survey which showed that 35% of you were worried by changes to super tax concessions.

The letter went on to say  “while our membership has in the past been supportive to some reforms there remains widespread confusion as to your proposals and their impacts.”

Fast forward to this week and David Crowe, writing for The Australian reports that Treasurer Scott Morrison is vowing to scale back the “extremely generous” tax breaks on superannuation, telling wealthier Australians to accept the changes while other people are also dealing with cuts that are needed to balance the budget.

The Treasurer hardened his message on the need to scale back the tax concessions saying “The tax arrangements for superannuation have been extremely generous and they were made extremely generous at a time when there was $20bn of surplus in the budget and $40bn in the bank.”

Speaking on 2GB this week Mr Morrison said “Now, the simple truth is going forward with the way things are globally and where the budget is at, those sorts of concessions can no longer be afforded.”

David Crowe writes “Mr Morrison persuaded parliament to accept tougher rules on the pension assets test when he was social services minister, scaling back the part-pension for thousands of older Australians in the name of budget repair.”

Reports this week suggest there’s considerable division in the coalition ranks as to the way the $1.6 million cap on retirement funds might work in reality. In addition the shadow of alleged retrospectivity continues to hang over the $500,000 cap on non-concessional contributions.

The one area our members, who come from both sides of the political divide, would agree with is that making super fairer for those with far from flash balances is a good move.

But they might also warn that changes to superannuation rules and concessions should only be well-considered, rare and subject to industry and consumer consultation.

It now appears the edicts handed down on super in the May Budget, and then taken straight to the election, will be subject to much-needed scrutiny and discussion as to their effectiveness.

Originally posted on .

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Graham
Graham from QLD commented:

Our politicians need to lead by example. If we genuinely need extensive changes to superannuation - lead the way. From Herald Sun, the following: "Outgoing MPs and Senators are set to cost taxpayers up to $4500 a week in generous pension payments. Twenty-seven retiring politicians are eligible for large annual pensions under the Parliamentary Contributory Superannuation Scheme. The program came to end under John Howard's government in 2004 but the changes were not retrospective, meaning parliamentarians elected before 2004 remain entitled to annual payments of more than $100,000. The majority of the outgoing MPs and Senators will pocket an annual minimum pension of $118,000, or 75 percent of a current MP's notional salary of $157,500. But the figure increases significantly when bonuses for ex-ministers and officer holders as well as for time served in parliament are taken into account. Bronwyn Bishop is expected to earn up to $250,000 annually, having spent almost 30 years in parliament and served as a minister as well as speaker. Politicians who served in parliament for more than 20 years, including Warren Truss, Philip Ruddock, Bruce Scott and Ms Bishop, also enjoy up to 10 free domestic return flights a year.The program currently costs taxpayers more than $44 million a year and this year's batch of former parliamentarians will add another $2.3 million to the bill annually." 

CARMEL
CARMEL from QLD commented:

I have worked since I was fifteen and retired at 65! With super savings I am a self funded retiree due to gov changes to super What is the incentive to save for your retirement? 

Someone
Someone from VIC commented:

That's fine Mr Morrison. Just reduce our Personal Super Savings, Treble the Government Aged Pension Allowance and Reduce the Retirement Age to 60 for both sexes. That should help us balance our personal deficits too. Put a freeze on moving the goal posts for 10 year stints too. 

Elmarie
Elmarie from NSW commented:

I agree with David. The self righteous pollies need to clean up their own backyard before messing with ours! 

David
David from QLD commented:

I am a middle of the road self funded retiree, I partly accept that we need to make changes to our super but what really annoys me are two things. 1) Grandfather clauses not only for super but across the line 2) super rules should apply to all, not a separate set of rules for politicians 

Bruno
Bruno from NSW commented:

Numerous issues greatly concern me relating to the changes to super. These issues stopped my family voting Liberal at the last election. They are: Constant changes to super rules. Retrospectivity of the changes. Government ignoring the impact of changes on those that have made long term planning decisions on the basis of rules of the day that can't be reversed. I could keep writing......... which is the biggest worry! Bruno T. 

Annette
Annette from NSW commented:

If the government makes super less attractive more people will end up relying on the age pension. It makes no sense. 

Darren
Darren from NSW commented:

To all OUR government members, and by that I also mean EVERY member that " SLEEP " during parliament time that use the taxpayers money to pay for their luxury lifestyles then pretend to do good for the country when they only do good for themselves, should be the first to have their super and pensions cut. what's good for the goose should be good for the gander " CORRECT " ! .. Australians are not appreciated by the government. They are being penalized instead. You work so hard and get nothing. The premise behind superannuation is simply to provide for oneself in retirement ...... makes it rather an unattractive proposition when "the goal posts" are shifted ! .... & WHO pays 4 our Spend thrift politicians :- cooks - drivers - LODGE cleaners - & furniture changes when the Official Residents gets a TENANT change ?? .... 

Darren
Darren from NSW replied to Darren:

I, like OUR government borrowed some of the pieces 4 my comment, so 2 those I have taken from, T/Y & it goes to show the Australian Public r getting " FED UP " 

Wayne
Wayne from QLD commented:

I believe the 1.6m cap on funds should not be a 1 fits all age approach, it should be age dependant. I am 56 & will be subject to this limit also when my funds have to last a lot longer than someone aged 65. It starts to make withdrawing of super over 1.6m cap & invested outside more attractive. Maybe they are trying to kill superannuation off with constant rule changes on this easy target. 

Someone
Someone from NSW commented:

I scrimped and saved and set my super up with the rules of the day and retired at age 69 with what I thought would allow my wife and I to retire comfortably and not impose on future taxpayers. As of 1 July 2017 everyone with more than $1.6m in super is retrospectively affected. The unfairness of this policy has certainly been seen in lack of voter support in the recent election. I, and I suspect more than 4% of supposedly affected voters, will not vote for any Government which adopts this unstable policy and money-grabbing attitude. 

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