John Brogden, CEO of the Financial Services Council, has announced that the FSC is going to begin work on a national retirement income policy.
“We must embrace the opportunity and lead the debate on taking superannuation from a world class accumulation scheme to the world’s best retirement system”, said Mr Brogden.
He went on to say that the superannuation system must not only provide an income in retirement to “a majority of Australians”, it must also take “intergenerational pressure off the budget”. If the super system fails to achieve these goals the “system and policy has failed”.
The FSC plans to work with “our members, business leaders, community organisations and others” to develop a policy, called the “National Retirement Outcomes Policy”.
According to the FSC “this policy will form views on critical issues that will determine whether superannuation succeeds or fails as the savings vehicle for Australia’s future”. “The alternative is rolling, piecemeal and constant changes into the system that undermine confidence and stability”, said Mr Brogden.
This National Retirement Outcomes Policy will consider:
- The efficiencies of tax concessions in the different phases of superannuation
- If tax concessions should only apply up to a certain superannuation balance
- If the superannuation guarantee rate should be increased past 12%
- Tests applying to superannuation for the Age Pension
- Lump sums vs annuities
- The role of life insurance
This call for a retirement income policy follows from the observation by the Financial System Inquiry that superannuation is currently overly focused on the accumulation phase, and lacks the products and services to meet the growing demand for retirement income.
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