Australia’s peak seniors and community sector organisations today urged the Prime Minister to stand firm on the Government’s commitment to deliver the fairer superannuation system announced in the 2016 Budget.
The nation’s seniors peak body, COTA Australia, and the Australian Council of Social Service (ACOSS) signed a joint letter to the Prime Minister, concerned that good policy was under threat from pressure being applied by a small number of adversely effected individuals.
COTA recently surveyed its membership Election Panel and 87% agreed that ‘the current tax concessions on superannuation contribution favour the well-off’.
The COTA and ACOSS joint letter calls on the Government to hold firm on key features of its Budget superannuation reforms:
“we write to urge you to hold firm in resisting calls to weaken, defer or abandon the key features…of the superannuation reform package contained in your recent Federal Budget.
“We have…been very concerned that the tax treatment of superannuation prior to this Budget was not ‘fit for purpose’.
“Superannuation had become a wealth and estate management tool, especially for those with the highest incomes, and this has been having a seriously negative affect on the integrity, credibility and cost of our superannuation system.
“The Budget measures to limit the amount of accumulated superannuation on which earnings will be tax free; to place a lifetime limit on the level of non-concessional contributions; and to lower the annual limit on concessional contributions all go a significant way to addressing those concerns.
“The existing tax system offers too little support for people with low incomes, most of whom are women. The proposed tax offset for low income earners…will have a positive impact…and must be pursued.
COTA and ACOSS also wrote to the Opposition Leader and Leader of the Greens to urge consensus:
“it should be possible in the interests of equitable retirement incomes and budget repair for the major parties to agree to modest bipartisan action to curb excessive superannuation tax concessions for people who do not need more public assistance to achieve an adequate retirement income.
ACOSS CEO Cassandra Goldie said measures needed to be put in place to ensure superannuation was used as is was originally intended.
“Tax breaks for super should be about adequate retirement incomes and reducing reliance on pensions, not wealth accumulation for people already well off. Every dollar lost to public revenue from badly designed tax breaks is a dollar less for health and care services for an ageing population,” Dr Goldie said. “While ACOSS does not support all of the Budget super proposals, they, along with changes proposed by Labor and the Greens, would curb the worst excesses of ‘high-end’ super tax breaks and reduce the unfair tax penalties that face low income earners saving for retirement. It should be possible for the Parties to least agree on these kinds of modest changes to make superannuation more fit for purpose.”
Ian Yates, CE of COTA Australia, said he, and many other industry, academic and consumer advocates, had long been calling for an end to overly generous tax concessions; and the measures outlined in the Budget had been widely welcomed.
“It would be a sad reflection on the state of the Australian politics if good policy, which makes our superannuation system more equitable and sustainable, were overturned because of pressure from the self-interested,” Mr Yates said.
COTA – Ian Yates 0418 835 439; Olivia Greentree 0439 411 774
ACOSS – Dr Cassandra Goldie 0459 400 440; ACOSS Media 0419 626 155