Coalition super policy draws industry criticism

The Coalition’s superannuation policy released this week has drawn mixed reviews, with several major industry bodies expressing disappointment at the policy for being unsubstantial.

The Association of Superannuation Funds of Australia (ASFA), the Australian Institute of Superannuation Trustees (AIST) and the Financial Services Council (FSC) said in a joint statement that a failure to increase the superannuation guarantee (SG) to 12 percent, the failure to raise the concessional caps for individuals over 50 and the failure to provide a super tax contribution rebate for low-income earners would adversely impact Australian workers.

But Financial Planning Association (FPA) chief executive Mark Rantall welcomed the Coalition’s commitment to consult with the industry on all aspects of the Cooper Review, including the MySuper recommendation, calling it a step in the right direction.

ASFA chief executive Pauline Vamos said that the majority of Australian voters would be disappointed that the Coalition’s only plan for superannuation was the promise of more reviews and delays.

“The Coalition’s costings document highlights bottom line savings at the expense of Australian workers’ retirement benefits. Early investment in superannuation provides huge benefits for individuals and the Australian economy as whole,” Vamos said.

Recent polls show almost 90 percent of working Australians supported an increase in the SG from 9 to 12 percent, according to ASFA.

AIST chief executive Fiona Reynolds said: “Australian voters are entitled to expect more than a policy document that has no concrete plans or even fresh ideas on how to address retirement income adequacy and the challenge of Australia’s ageing population.”

But Rantall welcomed the Coalition’s commitment to review the tax deductibility of financial advice fees, which he said would be a step towards Australians accessing affordable advice.

“The FPA is urging the Coalition, like Labor, to do more to promote the importance of Australians seeking financial advice and to prepare for their retirement. Industry consultation on these issues will potentially ensure better outcomes for all consumers,” Rantall said.