The Association of Superannuation Funds of Australia (ASFA) today called for greater integrity and rigour in the policy debate on the nation’s $2.1 trillion superannuation sector.
The Senate Economics Legislation Committee is currently holding a public hearing on the Superannuation (Objective) Bill 2016 and ASFA, along with other peak industry and financial groups, has made a submission.
ASFA CEO Dr Martin Fahy said super is the main game in town and any claims other financial assets could do the heavy lifting in retirement need to be rejected.
“ASFA strongly refutes any alternative facts about the significance of super,” he said.
Dr Fahy said recent ABS figures show that for households with the household head aged 15 to 64, superannuation is the most commonly held asset, apart from own home, bank accounts and motor vehicles.
“Other financial assets, apart from owner-occupied property, are held by only by a relatively small proportion of households,” he said. “Only one in five households has an investment property and only one in 30 households has an interest in a public or private trust.
“Analysis of wealth distribution using mean or average data instead of an approach based on the median or typical Australian is breathtaking in its lack of analytical rigour.
“James Packer’s and Harry Triguboff’s wealth when averaged across the population does not assist others in achieving their retirement income goals.”
Dr Fahy said for the great bulk of households, 90 per cent or more, superannuation together with owner-occupied housing were the dominant forms of saving to support living standards in retirement.
“Another key fact under attack by some commentators is that super already makes a substantive difference to the retirement incomes of low-income earners,” he said.
“Even low balances under the assets test threshold can lead to significant increases in income. The suggestion that super doesn’t assist low-income earners is a nonsense.
“ASFA projections show those reaching the comfortable standard will increase from about 20 to 40 per cent of Australians by 2040, based on current settings and including the increase in Superannuation Guarantee payments to 12 per cent.
“Super is working to provide more and more Australians with a dignified retirement as the system matures. We shouldn’t sell out future generations of retirees by swapping our aspirations for superannuation for short term fiscal imperatives.”
For further information, please contact:
Teresa Mullan, Media Manager, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral and non-party political, national organisation. ASFA’s mission is to continuously improve the superannuation system so people can live in retirement with increasing prosperity. We focus on the issues that affect the entire superannuation system and represent more than 90 per cent of the 14.8 million Australians with superannuation.