Banks bear brunt of super uncertainty
Banks are receiving numerous calls from anxious customers due to the proposed changes to tax on super, according to the Australian Bankers' Association (ABA).
"We've been advised by banks that many customers are concerned about their financial security in retirement because of speculation the Government plans to increase the level of tax on retirement savings," said ABA chief executive Steve Munchenberg.
He said successive Governments had urged Australians to save for their retirement, while the current Government implemented super reforms it said were aimed at increasing Australian retirees' savings and security.
"The proposals now being considered appear to reverse that approach," Munchenberg said.
"Ongoing speculation and change undermines confidence in superannuation, discouraging Australians from making voluntary contributions and raising uncertainty over whether superannuation delivers the financial security customers are looking for," he said.
With an ageing population and people expected to live longer, the Government's overriding priority should be to encourage people to save for retirement, ABA said, but constant changes to the super system and increased taxes worked against this goal.
"Unfortunately, if they only rely on compulsory super contributions from their employers and don't make any voluntary contributions, most working people will be well short of what they need for a decent standard of living after they leave the workforce," Munchenberg said.
It would increase reliance on the age pension in the future he said.
"Bank customers need a commitment from both major parties that they will not make continual changes to superannuation that undermine the security superannuation is meant to give Australians who have worked and saved all their lives," he said.
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