Thursday, April 04, 2013

Super. Why Swan won't wait until the budget

The Gillard government is under pressure to reveal its plans for superannuation within weeks after three of the crossbenchers it needs to get the changes through parliament said they will treat them more favourably if they are unveiled ahead of the May budget.

Greens deputy leader Adam Bandt said Labor needed to “learn the lesson of its media reform debacle” and make the details clear “sooner rather than later”.

Former speaker Peter Slipper said “any proposals for consideration should be announced as quickly as possible.”

North Queensland MP Bob Katter said a quick explanation would help correct the ‘‘distinct impression’’ the government did not know where it was going.

Treasurer Wayne Swan hinted at an early announcement Wednesday saying although the changes were not yet finalised, as soon as they were “we will make our announcements”.

Prime Minister Gillard will be overseas until mid next week making the most likely time for an early announcement the following week.

The changes would “not be making a significant contribution” to the budget in this or next few years Mr Swan said, but would help rein in the ballooning cost of superannuation tax concessions over the longer term.

Finance Minister Penny Wong will use a speech in Adelaide Thursday to argue the package will set up superannuation for years to come...

By its very nature, superannuation demands a long-term perspective,” she will say.

“Realities such as an ageing population and greater longevity require consistency, sustainability and fairness, and this government’s approach to superannuation will continue to be guided by these principles.”

“To those who say we are out of step with previous Labor governments, I would say look at the facts. The Hawke and Keating governments reformed our social security system, making it more targeted and making space for higher priorities. Government’s budgets are finite, and always will be.

And in the end it is the most vulnerable – those who need support to get ahead – that often lose out if we disregard fiscal sustainability.”

Participants at a Melbourne superannuation roundtable hosted by financial services minister Bill Shorten were told the government wants to focus support on those people most at risk of falling out of superannuation system.

While there was broad agreement about the goal, there was disagreement about whether it could best be achieved by radical change or or by a period of stability which would build confidence.

Mr Shorten said people earning up to four times the average weekly wage had nothing to fear.

‘‘My very clear message to people in Australia who are working hard now, to people who are seeking to retire on adequate incomes, comfortable incomes, the vast bulk of people who are on average wages, one, two, three, four times average weekly wages - you are our priority,’’ he said.

‘‘I am not preoccupied with punishing particular sections of the community. What I am preoccupied with is having a sustainable system which supports all the people of Australia who aspire to relying not solely on the age pension.’’

Mr Katter said he would view changes as retrospective if they touched earnings by funds. ‘‘I just abhor retrospectivity,’’ he said.

Although he had no sympathy for CEOs on ‘‘obscene’’ salary levels, Mr Katter would be worried about entrepreneurial owner-operators being caught up in superannuation tax changes affecting people earning $300,000.

In The Sydney Morning Herald and The Age

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