Superannuation

1

Industry super wins $11b from rorting retail funds

By Leith van Onselen Data from the Australian Prudential Regulation Authority (APRA) show that retail superannuation funds’ outflows totalled $10.9 billion in 2018, compared with just $3.5 billion in 2017. Industry funds benefited from the negative sentiment toward retail funds, with AustralianSuper’s funds under management rising by 17% to $140 billion, lifting its market share

18

How much do you need to retire comfortably?

By Leith van Onselen The Association of Superannuation Funds of Australia (ASFA) has released new estimates from the December quarter claiming the rising cost of essentials has pushed up the amount of money Australians need to live a comfortable retirement. From The Herald-Sun: [ASFA] found for couples to live a comfortable retirement — assuming they

29

Fake Greens scuttle sensible super reform

By Leith van Onselen Legislation passed by the House of Representatives yesterday will give the Australian Taxation Office more power to consolidate low-balance and inactive superannuation accounts. It will also cap fees on accounts with balances of less than $6,000 at 3% and will ban exit fees. However, the federal government’s plan to make insurance

2

Royal Commission another bitter pill for superanuation sector

By Leith van Onselen Only one month ago, the Productivity Commission (PC) delivered its scathing final report on the efficiency and competitiveness of Australia’s $2.8 billion superannuation system, which noted a multitude of failures ranging from a proliferation of poorly performing funds, excessive fees, unnecessary and costly insurance products, and multiple accounts. Most importantly, the PC

42

ATO: SMSF mortgages a ticking time bomb

By Leith van Onselen The Howard Government’s decision to allow self-managed super funds (SMSFs) to leverage into property and other investments was a mistake. Specifically, it allowed SMSFs to be turned into speculative vehicles rather than savings vehicles, in turn dramatically increasing the riskiness of Australia’s retirement savings and financial system, further inflating Australian house

19

LVO demolishes compulsory super on Radio 2GB

Yesterday afternoon I gave an interview on Radio 2GB’s Drive program talking compulsory superannuation. The interview starts from around the 44 minute mark and runs for around 12 minutes. In particular, I rip into Labor’s, the union’s, and Paul Keating’s call to raise the rate of compulsory superannuation to 12% or 15%, arguing that it

14

Doddering Keating still wants to lower worker’s pay

By Leith van Onselen Even after the Productivity Commission’s (PC) scathing final report on the efficiency and competitiveness of Australia’s $2.8 billion superannuation system, former Prime Minister and architect of Australia’s compulsory superannuation system, Paul Keating, has the gall to criticise the Coalition for delaying an increase in the superannuation guarantee, as well as attack the PC for

6

Why a broader review of superannuation is needed

Cross-posted from The Conversation: There’s a lot in the Productivity Commission’s landmark 722-page table-thumper of a report into Australia’s superannuation system, completed after nearly three years of invesigation. For now, I’ll make three comments. The Commission gets the industry First, it’s a very valuable report. The Productivity Commission (PC) has undertaken a deep analysis of

4

Adam Creighton wrong on superannuation concessions

By Leith van Onselen Adam Creighton penned an article in The Australian over the weekend attacking Labor’s plan to lower the high income 15% superannuation concession surcharge to $200,000 from $250,000 currently: Reducing even further the Division 293 threshold from $250,000 to $200,000 would mean a worker on a salary excluding super of, say, $210,000,

15

SMSF property leverage a ticking time bomb

By Leith van Onselen The Howard Government’s decision to allow self-managed super funds (SMSFs) to leverage into property and other investments was a mistake. Specifically, it allowed SMSFs to be turned into speculative vehicles rather than savings vehicles, in turn dramatically increasing the riskiness of Australia’s retirement savings and financial system, further inflating Australian house

18

The most important take away from the PC’s super review

By Leith van Onselen Last week’s final report on the efficiency and competitiveness of Australia’s $2.8 billion superannuation system was scathing, noting a multitude of failures ranging from a proliferation of poorly performing funds, excessive fees, unnecessary and costly insurance products, and multiple accounts. While these issues are all important and require urgent reform, the biggest

21

PC Report into super recommends ditching retail funds

by Chris Becker In news just in, the boffins at the Productivity Commission have worked out that putting your superannuation into “underperforming funds….that charge excessive fees” is harming Australians retirement savings. In other words, all the funds run by the banks. In other news, water makes you wet. The Federal Government commissioned – at some reluctance

30

Asset deflation likely to delay retirement plans

By Leith van Onselen New research from Roy Morgan shows that the number of Australians who intend to retire in the next 12 months is estimated at 426,000, a 30% increase on the level seen in 2008 when it was 328,000. Meanwhile, the average gross wealth (total assets excluding owner-occupied homes) of intending retirees is $331,000,

9

Dumb unions lobby to lower workers’ wages

By Leith van Onselen You can’t make this stuff up. Unions are reportedly seeking to change Labor’s platform on superannuation at its upcoming national conference, demanding an increase in the superannuation guarantee to 15% by 2030. From The AFR: The Transport Workers Union and the Construction, Forestry, Maritime, Mining and Energy Union are driving the push as

6

Keating’s superannuation monster is out of control

By Leith van Onselen The Australian’s Judith Sloan has continued her commendable attack against Paul Keating’s compulsory superannuation monster, describing it as “one of the costliest and most ineffective retirement models in the world”: Most people think Paul Keating has four children. In fact, he has five. The fifth is compulsory superannuation: super for short…

13

Labor man Greg Combet demands 12% compulsory super lift

By Leith van Onselen It looks like Labor will persist with raising Australia’s compulsory super rate to 12%, if former energy and climate change minister in the Rudd and Gillard governments, Greg Combet, is any guide. From The Australian: Greg Combet, now one of the most powerful figures in the $2.7 trillion superannuation system, says.. the government needed

3

The extraordinary fiscal cost of compulsory super

By Leith van Onselen The Australian’s Adam Creighton has penned an enlightening article on the extraordinary cost of Australia’s superannuation system, which is running at around quadruple that of the Aged Pension, according to analysis provided by the peak superannuation industry, Association of Superannuation Funds Australia (ASFA): Age Pension outlays, which totalled $46.8 billion this year,

6

ISA: Turn super into an infrastructure slush fund

By Leith van Onselen The outgoing chair of Industry Super Australia (ISA), Peter Collins, has urged for Australia’s superannuation pool to be turned into a slush fund for infrastructure investment and “asset recycling”. From The AFR: Peter Collins has challenged a future Shorten government to make asset recycling using superannuation money a priority… “The flow

14

PBO: 710,000 Aussies would opt-out of compulsory super

By Leith van Onselen The Australian’s Adam Creighton has revealed analysis from the Parliamentary Budget Office (PBO) suggesting that 710,000 younger and lower-paid Australians would oft-out of compulsory superannuation, and increase their take-home pay, if given the choice. And allowing this option would improve the Federal Budget by $1.9 billion a year by 2029: An

14

The real “victims” of Labor’s franking credit reforms are wealthiest retirees

By Leith van Onselen Last week, a Coalition-led parliamentary inquiry into Labor’s dividend imputation policy began public hearings, which heard a conga-line of vested interests bemoan that Labor’s proposed reforms are “unfair” and would smash “ordinary Australians” and “lower-end retirees”. However, this special pleading has already been debunked by the Parliamentary Budget Office (PBO), which released

13

Superannuation is a tool for the wealthy

By Leith van Onselen The ABS yesterday released the below chart showing the disproportionate superannuation benefits received by high income earners: Superannuation benefits received are recorded as a memorandum item of the household income account. Superannuation benefits received in the ASNA are treated as financial transactions of households and are not recorded as income; instead

3

Doddering Keating contradicts himself on super

By Leith van Onselen When the architect of Australia’s compulsory superannuation system, Paul Keating, appeared on ABC’s 7.30 Report, he argued that raising Australia’s superannuation guarantee (i.e. compulsory superannuation contributions) from 9.5% to 12% would not lower take home wages: LEIGH SALES: There might be some Australians watching who are saying, “Well, if we are

109

Treasonous ACTU lobbies to lower workers’ take home pay

By Leith van Onselen The treasonous ACTU has backed Paul Keating’s call to lift Australia’s superannuation guarantee (i.e. compulsory superannuation contributions) from 9.5% to 12%, claiming it would ensure workers retire with dignity: …the average superannuation balance today for men is $112,000 and women $68,000 and only 20 per cent of current retirees are fully

16

Paul Keating is a super idiot

By Leith van Onselen The architect of Australia’s compulsory superannuation system, Paul Keating, has once again demanded the federal government to raise Australia’s superannuation guarantee (i.e. compulsory superannuation contributions) from 9.5% to 12%, claiming it would ensure workers retire with dignity: Mr Keating told 7.30 that super payments had to be raised to 12 per cent,

6

Life insurance parasite demands its super subsidy

By Leith van Onselen The Productivity Commission’s (PC) landmark 500-plus page draft report on Australia’s $2.6 trillion superannuation industry explicitly recommended abolishing compulsory life insurance for people aged under-25: Current settings are more a function of history than considered policy design. …many entrenched problems remain (and insurance accounts for over a third of member complaints

2

Industry parasites demand lift in compulsory super rate

By Leith van Onselen The superannuation industry has returned fire on the Grattan Institute’s retirement report which calls for plans to increase the compulsory super guarantee to 12% to be shelved. They warn that more Australians would have lower living standards in retirement and be dependent on the age pension if the Grattan Institute’s proposal