Seniors advocate COTA Australia said most older Australians would welcome the superannuation changes announced today as they increase fairness, help people with lower super, and give certainty for the future.
Ian Yates, COTA Australia’s Chief Executive, said in particular seniors would welcome giving lifetime annuities the same concessional tax treatment as other products – which COTA has been calling for for some years.
He said COTA had identified the need for a broader range of income products to be available to help people ensure their superannuation lasts their lifetimes.
“In COTA’s Budget Submission we called for deferred lifetime annuities to get the same concessional tax treatment as other products, so we are pleased the Government has decided to adopt this measure,” Mr Yates said.
“The increase in the cap on concessional contribution is a positive step and, while it falls short of the $50,000 for people over 50 that COTA had argued for, it will provide welcome assistance for those over 60 who were hit hardest when the cap was introduced last year and are still trying to accumulate a reasonable retirement income.
“Today’s announcement also gives certainty to older people who have been very nervous about their superannuation arrangements given the wild speculation over recent weeks.
“The move to cap the level of income that is tax free to $100,000 a year will not affect most retirees and has a measure of equity in that it means an individual’s tax concessions on super will only be slightly higher than the cost to taxpayers of an age pension
“There will still be concessional tax treatment as income over the $100,000 will only be taxed at 15 per cent, and the $100,000 limit will be indexed, which is welcome and fair.
Mr Yates said the establishment of the Council of Superannuation Custodians and the Charter of Superannuation Adequacy and Sustainability is a good initiative as it will create an independent body to look at proposed changes and assess them against the Charter.
“COTA Australia supports the principles of certainty, adequacy, fairness and sustainability that will guide the Charter as these are the issues that many older Australians raise with us.
“We welcome public consultation on the Council and the Charter and urge the government to ensure there will be strong consumer representation on the Council.
“COTA Australia encourages the Government to introduce the legislation for these measure in the Budget session of Parliament so they can come into effect as soon as possible,” Mr Yates said.
Media contact: Ian Yates 0418 835 439, Jane Garcia 0434 489 533
