working for Australians in retirement

Superannuation Submissions By A.I.R.

AIR has continually been tracking proposed changes to Superannuation and participating in the discussion. The changes that passed in the House of Representatives this week have been a long time in the making.

Submissions to Federal Treasury

Below are recent submissions which have been lodged with the Federal Treasury in response to

(a) a discussion paper on the Objective of Superannuation
     Read AIR Submission on the Objective of Superannuation April 2016

(b) input to the Government’s public consultation process on the exposure draft legislation:
Draft legislation: Superannuation (Objective) Bill 2016[
Treasury Laws Amendment (Fair and Sustainable Superannuation) Bill 2016; and
Treasury Laws Amendment (Fair and Sustainable Superannuation) Regulation 2016 to implement five of the superannuation measures announced in the 2016-17 Budget

Read AIR Submission on draft Superannuation Legislation 08-09-2016

AIR Media Release

This media release below was issued in response to the changes to the Government’s Budget superannuation proposals announced 15 September 2016.  Click here for a PDF

Government Accedes to Calls for Change to Superannuation Proposals

The Government has responded at least in part to pressure by A.I.R. and other organisations representing self-managed superannuants to change aspect of its Budget proposals around superannuation.
The decision to scrap the $500,000 lifetime non-concessional cap is very sensible given its benefit was questionable in light of the $1.6m transfer balance cap. The replacement of the lifetime non-concessional cap with a reduced non-concessional cap of $100,000 a year (with $300,000 bring forward) going forward is much better than a lifetime cap of $500,000 back-dated to 2007. While it is not as favourable as the current $180,000 per year limit, it will allow people to continue making contributions rather be stalled as is the current situation.
Of concern, however, is the decision not to proceed with the harmonisation of contribution rules for those aged 65 to 74. A.I.R. has advocated for many years for harmonisation as was proposed in the Budget and queries the figure quoted by the Government of a cash flow improvement of $180 million over the forward estimates and a total of $1,920m to 2026-27.
The decision takes no account of changes in the community and the fact that many people may need to work until they are 74 or more and, ideally, put every available dollar into superannuation to achieve some level of self-sufficiency when they eventually retire.
We cannot see how this decision in any way supports the Government’s stated objective to provide income in retirement to substitute or supplement the Age Pension. It appears that there has been little consideration given to what the current generations of working Australians will want from their retirement in the decades to come.
There is a similar disregard for the increasing longevity of Australians which requires easing of the annual compulsory drawdown capital percentages of retirees’ super accounts to allow them to stay off the pension for longer. It would be interesting to see an estimate from the Government on the additional Age Pension payments that will be required in future years.
This is yet another example of change being made on the basis of rushed consultation rather than the result of bi-partisan well-thought out, long term planning. It remains to be seen if the Government will also reverse the changes to the Age Pension qualifying age and the preservation age is the same nonsensical way.   

For further information, contact Sue Hart, Executive Officer on 02 6290 2599

Taper Rates Change

Are you in the "poverty trap" with assest test threshold changes?

More about Super Taper Rates here

Treasury Summary of Changes

View PDF of Superannuation Changes produced by The Treasury

More detailed information can be found at The Treasury Superannuation website