Opposition digs in against raising SG

The Federal Opposition has declared its position on the superannuation guarantee, stating that it is opposed to the compulsory lifting of the 9 per cent guarantee to 12 per cent.

The Opposition spokesman on financial services, Senator Mathias Cormann (pictured), said that the lifting of the superannuation guarantee to 12 per cent would undoubtedly be welcomed by superannuation funds, but would effectively be cutting people’s take-home pay by more than 3 per cent.

“Clearly this is very popular with the superannuation industry, including union super funds — it gives them an automatic increase in funds under management without having to work hard for it,” he said.

By comparison, Cormann backed the findings of the Henry Tax Review, which opposed lifting the superannuation guarantee on the basis that it would impact most heavily the standard of living of low and middle-income earners.

The Opposition spokesman said that before pressing ahead with lifting the superannuation guarantee, the Assistant Treasurer, Bill Shorten, needed to deliver on a pre-election commitment to abolish the preference for industry funds as default funds in modern awards, and act on the recommendations of the Cooper Review with respect to improving corporate governance arrangements.

Cormann said Shorten also needed to sort out the increasing problem of people inadvertently breaching superannuation contribution caps and being hit with excessive additional taxes as a result of the Government’s previous decision to halve concessional caps.