The Government has released a discussion paper on the introduction of Comprehensive Income Products for Retirement (CIPRs), or MyRetirement products – which is the Government’s favoured term.
“The Turnbull Government has today released a discussion paper exploring key policy issues to facilitate further development of a framework for the retirement phase of the superannuation system,” said Minister for Revenue and Financial Services, Kelly O’Dwyer.
It was a recommendation of the Financial System Inquiry, the final report of which was released in October 2015, that superannuation trustees be required to pre-select a CIPR for members.
“As part of its consultation, the Government is proposing to rename CIPRs ‘MyRetirement products’ as a more consumer-friendly and meaningful name,” said Minister O’Dwyer.
“As Australians enjoy longer and healthier lives and the superannuation system matures, it is important we get the settings for our superannuation system right.”
“This is an important reform that will help lift the living standards and choices of older Australians. There are seldom other reforms that offer such large potential increases in income, without a cost to taxpayers.”
“This builds on the Government’s superannuation reform package, which removes tax barriers to the development of new innovative retirement income stream products.”
Minister O’Dwyer said that individuals would not be forced into these products. The Financial System Inquiry envisioned a system where members could opt-out of CIPRs/MyRetirement products.
The Treasury website says:
The MyRetirement framework is intended to increase individuals’ standard of living in retirement, increase the range of retirement income products available, and empower trustees to provide members with an easier transition into retirement. Through this framework, the Government is aiming to increase the efficiency of the superannuation system so it can better achieve the proposed objective of superannuation, which is to provide income in retirement to substitute or supplement the Age Pension.
Submissions in response to the discussion paper close 28 April 2017.
Update: the due date for submissions has been extended to 9 June 2017.