The Latest On Superannuation
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.
