Australia “must aspire to more” when it comes to a legislative objective for superannuation, says the Association of Superannuation Funds of Australia (ASFA).
“Australia is a wealthy nation and we are proud of our lifestyle, beautiful country and so many achievements. But do we really aspire to the simple view that as many people as possible should be able to enjoy a comfortable lifestyle in retirement? If we don’t, what retirement can people really look forward to?” said ASFA.
The Government has been consulting on draft legislation to enact the following as the objective of superannuation:
The primary objective of the superannuation system is to provide income in retirement to substitute or supplement the age pension.
This objective has been described as another industry body as setting a “very low bar“.
“If there was ever a time to take an interest in super, now is it,” said ASFA.
ASFA CEO Jim Minto said the legislated objective will define how future governments treat superannuation.
“The objective shapes how much future governments will provide in the form of the age pension together with incentives for people to save for their retirement,” he said.
“We know that with tight budget positions in the future, the government won’t be able to afford to provide a basic pension to ensure a comfortable and dignified retirement for Australians. It isn’t enough now for most people and it’s likely to be even less so in the years ahead, but Australians should aspire to more.”
“ASFA wants the legislated objective of superannuation to enable as many people as possible to enjoy a comfortable standard of living in retirement.”
Issues of adequacy and a comfortable retirement have also been raised by other industry bodies, including AIST and the FPA.
“By setting a comfortable standard of living as the goal, future governments will look to encourage all Australians, not just the wealthy, to save more for their post-work years,” said Mr Minto.
“This is an issue for people to get involved in. It is far too important to be left purely for politicians to decide, with limited public involvement.”
“It is un-Australian for today’s politicians to settle on an inadequate objective for super that restricts its purpose to merely substituting or supplementing the age pension.”
“We urge people to take a strong interest in this important issue for themselves and future generations.”
“What we set in law now will be hard to change later and Australians are perfectly right to expect a comfortable and dignified standard of living in retirement.”