Reform needed to ensure super growth

Superannuation payouts for retirees could rise by as much as 25 per cent within the next 20 years, but the Federal Government must first commit to a program of rigorous economic reform, a new report has concluded.

The Access Economics study, commissioned by the Business Council of Australia, urges the Government to pursue a reform agenda in order to maintain Australia’s growth rate at 4 per cent per annum over the nest 20 years.

If it does, every Australian would be $74,000 better off in today’s terms by 2025 according to the report, while Government revenue would rise by almost $80 billion, making Australia the third richest country in the world.

Average superannuation payouts would also rise by 25 per cent the report said, which “would free many of us from the financial concerns otherwise weighing on our retirement”.

Some of the key reforms needed to achieve the goal include increasing productivity and workforce participation, better infrastructure planning, increased investment in education and training and higher immigration.

Reforms to superannuation were also needed the report said, including a possible increase to the age people are allowed to gain access to benefits.

Commenting on the report, Business Council of Australia president Hugh Morgan said the difference between an Australia which achieves the high growth rate, and one which fails, would be stark.

“The research aims to demonstrate conclusively that when reforms are made and the economy grows strongly, the vast majority of Australians directly benefit — through more jobs, higher wages and increased prosperity,” he said.

“The research demonstrates the reverse is true — if reform stops and we allow the economy to stand still or be overtaken by our competitors, everyone loses.”