Monday, March 15, 2010
The obvious response is "Good. Let them."
And "What's stopping them?"
Today's typically-crappy missive from the super lobby is below, along with others of its ilk:
15 March 2010 Six out of ten Australians want it…and will pay for it: survey
Almost two-thirds of Australians (61%) support a rise in the Superannuation Guarantee to 12% and they are prepared to pay for it with a direct contribution from their wages, according to a survey released today by the Australian Institute of Superannuation Trustees.
The Coredata* consumer survey, released at AIST’s Conference of Major Superannuation Funds in Brisbane, suggests many Australians are concerned that their current level of super contributions won’t provide them with enough retirement income.
AIST CEO Fiona Reynolds said it appeared that the community was ahead of the views of most politicians on the need to lift the level of super contributions.
“It seems that both the super industry and the public understand that 9% super is not going to deliver a comfortable retirement. We hope this message is received by the Government and the Henry Review and that steps are taken to improve adequacy within our retirement incomes system,” said Ms Reynolds.
The survey also found that 60 per cent of respondents thought the Government should be doing more to help low to middle income earners pay for their retirement.
“AIST has long advocated for the abolition of the $450 monthly income super threshold and the inclusion of a super component in parental leave schemes,” Ms Reynolds. “These are key measures that would immediately assist low and middle income earners grow their super.”
The survey also highlighted that while the majority of respondents expected better returns from their super fund this year, many were concerned about their retirement planning with 55% either “concerned” or “very worried” about the government changing the laws around access to super.
“While we accept that after 20 years of compulsory super the current reviews are necessary and can bring about much-needed reform, we urge the Government to respond quickly to any recommendations so that people can plan their retirement with certainty,” said Ms Reynolds.
Other key findings were:
• Confidence in super remains high – with nearly 70% agreeing that super is a good way to save for retirement.
• Switching to remain low though investment performance satisfaction not high - 73.5% do not intend to move their super either to another fund or a different investment option in the next year although only one third of respondents (34.4%) are satisfied with the investment performance of their super fund.
• Voluntary contributions could be on the rise: Roughly one third of respondents make additional contributions above 9%, and of these 30% intend to increase them in the next 12 months.
• Engagement with super may be improving - 34% know their super balance to the nearest $1000.
• Love affair with property continues: If they had spare cash, two-fifths of respondents (43.6%) would buy an investment property to help save for their retirement. 22.4% would make additional contributions to super. Female respondents are twice as likely to put spare money into the bank than male respondents. Males nearly three times more likely to invest in the sharemarket.
• DIY advice on super: 35.8% use their own judgement rather than experts for advice on super; 20.6% turn to their super fund as the prime source; 9.1 turn to non-aligned financial advisors; 8.6 turn to aligned financial advisors.
*Coredata online survey of just over 1000 respondents conducted between March 3 – March 11, 2010. Copy of survey available on AIST Website: www.aist.asn.au
March 7, 2010 Government must bridge gender superannuation gap
The Australian Institute of Superannuation Trustees (AIST) today called on the Rudd Government to address the gender superannuation gap by introducing a range of measures to improve retirement outcomes for Australian women.
Noting that it is International Women’s Day (tomorrow March 8) and Australian women had one of the lowest workforce participation rates in the OECD countries, AIST CEO Fiona Reynolds said the average Australian woman currently retired with $73,000 compared to the average male who retires with a super balance of $155,000.
“Whether raising children or caring for the elderly, Australian women spend on average 15 years less in the workforce than their male counterparts,” said Ms Reynolds.
“After nearly 20 years of compulsory super, it’s time for the Government to recognise that career breaks have a significant impact on women’s super balances.”
AIST’s recommendations to improve the gender gap in superannuation include:
• Paid parental leave with a superannuation component or a one-off $1500 Super Baby Bonus;
• Abolition of the $450 monthly income superannuation threshold that results in many casual and part-time women missing out on superannuation;
• Extension and enhancement of the Government’s Co-contribution Scheme so that more women benefit;
• Government rebate of the current 15% contribution tax on super for low income earners.
• Recognition that older workers who have not had the benefit of a working lifetime of compulsory super need higher concessional cap limits than younger workers to allow them to catch-up on their super.
11 March 2010 Women need action on Superannuation now
New research released today by the Investment & Financial Services Association (IFSA) demonstrates the need to include superannuation in any paid parental leave scheme voted on by the Parliament.
John Brogden, Chief Executive Officer of IFSA, released independent research today that proved the current debate was of critical importance to the quality of life all Australian women could expect in retirement.
“This research shows Australian women face a grossly inadequate retirement because of their low superannuation savings. It is clear that whichever parental leave system that the Parliament adopts, it must include superannuation”, Mr Brogden said.
“The research clearly demonstrates that Australian women are punished for having children. They will have low superannuation and a poor retirement income just because they chose to have a family.
A typical Australian woman will have $91 400, or 35%, less than a man in their superannuation savings if they have children.
The independent research carried out by Rice Warner Actuaries for IFSA shows:
· a typical woman will save 35 percent less for her retirement than a typical man;
· a woman retiring at 67 must save an additional 13 percent more for retirement than a male in the same situation as she has longer life expectancy;
· a woman who takes five years out of the workforce to have and raise her children will have 26 percent less superannuation on retirement than an equivalent woman who has not taken time out of the workforce;
· the current nine percent superannuation guarantee contribution is inadequate for women who have average life expectancy. They would have to contribute 16 percent simply to retire with adequate superannuation; and
· women who live longer than the average life expectancy will need to contribute 19 percent to live adequately in retirement.
“IFSA calls on the Parliament to recognise that it is no longer good enough to put up with the status quo. This debate is a critical opportunity to make sure that we get it right and ensure women are not penalised in their retirement.
In January IFSA released data showing that almost no one in Australia relying on the nine percent Superannuation Guarantee Contribution would be able to have an adequate retirement”, concluded Mr Brogden.
Wednesday 24th February 2010 Debunking the myth of superannuation tax concessions: Mercer analysis
New research from Mercer dispels the myth that superannuation tax concessions have led to high income earners receiving the lion’s share of government support for retirement income.
The relative level of government support for individuals should take into account both superannuation tax concessions and the government funded aged pension. Taking this approach, Mercer’s analysis found the total government support for retirement income is remarkably equal across a variety of income levels, including low, middle and higher income earners (Figure1).
Furthermore, when comparing the support provided for couples (Figure 2) across seven income levels, Mercer’s research revealed the total level of support provided by the government actually decreases as income rises or as superannuation contributions increase.
Currently, all concessional superannuation contributions are taxed at 15 per cent, irrespective of the individual’s marginal tax rate. This has led to concerns over whether the system is biased towards high income earners, who are perceived to receive more government support for retirement incomes than low income earners.
Dr David Knox, Partner in Mercer’s Retirement, Risk and Finance consulting business said the research cast new light into the debate around the cost and equity of superannuation tax concessions.
“Much of the criticism of tax concessions fails to take into account the direct link between the level of retirement and savings and reliance on the aged pension. When considering the cost of superannuation tax concessions, looking at the tax concessions only tells half the story.
“As we expected, this research shows that those with higher incomes or receiving higher salary increases do receive a higher level of superannuation tax concessions than low income earners - but they are also likely to receive a lower level of government funded age pension. What is interesting is the overall cost to the government is roughly the same, regardless of whether the funding is weighted towards tax concessions for a higher income earner or providing the aged pension to a person who needs to top up their income in retirement.”
Mercer’s analysis also showed that if superannuation contributions were increased to 12 per cent, whilst total income in retirement would be greater, the total level of support required from the government for retirement income would actually decrease slightly for most individuals.
Dr Knox said most individuals who received a higher level of employer contributions, either through salary sacrifice or a higher Superannuation Guarantee would receive a lower level of total government support due to the effect of super on the projected age pension payouts.
“This adds weight to the argument for increasing the Superannuation Guarantee to 12 per cent, particularly in light of the increased pressures our ageing population will place on government budgets in future decades.”
“These findings really underline the argument that any future tax changes should not reduce the taxation incentives for Australians to save for their future retirement needs through superannuation.”
January 31, 2010 Australians facing a retirement savings disaster
The latest research released today by the Investment & Financial Services Association (IFSA) showed
Australians face a massive savings shortfall that would see the majority of Australians struggling to
maintain their quality of life in retirement.
John Brogden, IFSA’s CEO, said the latest IFSA research undertaken, by Rice Warner Actuaries,
represented a confronting reality check. For a copy of the report, please click here.
“The retirement savings gap faced by Australians is the difference between what is actually being
saved and what is needed to sustain a reasonable lifestyle after ceasing work. This latest forecast
shows the gap has continued to grow.
“The retirement savings gap has blown out from $452 billion in 2004 to $695 billion in this report, an
increase of $26,000 per person to $73,000 per Australian.
“It is clear that the current super guarantee must be raised to at least 12 percent if people are to have
any chance of a comfortable retirement,” Mr Brogden said.
Mr Brogden said the research showed older Australians and women who had left the workforce for a
period to have a family were particularly exposed.
“Almost all of those entering the workforce today and having full careers to the age of 67 will need to
contribute more than nine percent if they are to maintain their lifestyles in retirement,” he said.
Mr Brogden concluded by emphasising that an increase in contributions to 12 percent is only the first
“The Federal Government will have to consider other incentives in this area to encourage further
investment in superannuation if Australia is to avoid a savings gap disaster in the future. Greater
flexibility in the area of concessional contributions caps would greatly assist. Alternatively, much of
the shortfall is going to have to somehow be funded out of future government revenue.” Mr Brogden
Rice Warner Actuaries have also produced Superannuation Savings Gap reports for IFSA in 2002 and
The campaign to impoverish Australians continues...
(I'd feel happier about it if it wasn't being fought with their own confiscated wages)
. Message to Australia's banking, real estate and super industries...
. Talk about less-than-honest rent-seeking
. The super-man is wrong: 9 per cent is plenty
. Tuesday Column: Please, please, don't put it into super
. Six reasons not to pour even more money into super
. Meanwhile, lets go behind the scenes at today's alcopops tax "revolt"