Superannuation

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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

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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

3

Grattan: Don’t lift compulsory super rate

By Leith van Onselen The Grattan Institute has released a new report, entitled Money in retirement: more than enough, which challenges the conventional view that Australians don’t save enough for retirement, and explicitly recommends against lifting the compulsory superannuation guarantee from its current level of 9.5% to 12%: The vast majority of retirees today and in

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Paul Keating admits his compulsory super system is failing

By Leith van Onselen Last week we blasted former Prime Minister, Paul Keating’s, daft plan to slug Australian workers a 2% to 3% ‘longevity levy’ to fund ‘geriatric’ care for people aged 80-plus whose superannuation savings have run out. Today, The Australian’s Judith Sloan has attacked Keating’s proposal, claiming he has tacitly admitted that his

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Productivity Commission rips into rorting retail super funds

By Leith van Onselen Back in May, the Productivity Commission’s (PC) released its 500-plus page draft report on Australia’s $2.6 trillion superannuation industry, which revealed in all its hideous glory that retail funds’ fees are well above not-for-profit funds: Accordingly, retail funds have delivered significantly lower net returns: The PC also found that reported fees

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MB Fund Webinar – A Super Problem?

This week’s webinar is a focus on the structural problems with superannuation: – How tax breaks are skewed – Superannuation isn’t working at getting people off the aged pension – Problems with superannuation funds in focus at the Royal Commission – Investment opportunities Find out below: Take us on your daily commute ! Podcasts now

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FHB patsies raid $5m in super ahead of property bust

By Leith van Onselen Desperate to keep the East Coast property bubble going, the Turnbull Government last year passed legislation to allow first-home buyers (FHBs) to use up to $30,000 of voluntary super contributions for a housing deposit. The scheme was announced as part of a ‘housing affordability’ package announced in the 2017 Federal Budget.

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Grattan: Labor’s womens super policy more symbolism than substance

Cross-posted from The Conversation: When it comes to the gender gap in retirement incomes, symbolism appears to matter more than actually achieving something. Labor’s plan to add super contributions to government-funded parental leave was heralded by Opposition Leader Bill Shorten this week as having a “big impact down the track”. Our analysis shows it would

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Rice Warner: Compulsory super costs more than it saves

By Leith van Onselen Actuarial consultants, Rice Warner, are the latest group to claim that Australia’s compulsory superannuation system is costing taxpayers more than it saves in Aged Pension costs. From The Australian: The government’s age pension bill will be weighed by dismal ­returns in the bank-run super­annuation “choice” sector, according to a report from

21

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

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Let’s make the superannuation system voluntary

By Leith van Onselen After last month calling for compulsory super to be scrapped, The Australian’s Adam Creighton has penned a thought-provoking article espousing the benefits of making Australia’s superannuation system voluntary: On the only occasion citizens were given a chance to vote on something similar to the Australian system, in New Zealand in 1997, more

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Why the superannuation system punishes women

By Leith van Onselen The gender gap between men’s and women’s superannuation accumulation has once again reared its head with Assistant Treasurer Stuart Robert labelling the superannuation bias between men and women “the great inequality”. From The Canberra Times: A parliamentary inquiry into women’s economic security called “a husband is not a retirement plan”… heard

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Paul Keating still dazed and confused on superannuation

By Leith van Onselen Back in May, the architect of Australia’s compulsory superannuation system, Paul Keating, urged the federal government to raise Australia’s superannuation guarantee (i.e. compulsory superannuation contributions) from 9.5% to 12%, claiming it would compensate workers for productivity gains during a period of low wages growth. At the time, I noted that Keating’s argument

22

The Australian piles in against compulsory super “vampire squid”

By Leith van Onselen A fortnight ago, Judith Sloan labelled Australia’s compulsory superannuation system a form of “theft”: As the system of compulsory super has developed, it has become clear its two real effects are as follows. First, it forces many people to forgo valuable current consumption — think buying a house, paying school fees

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Should Australia scrap compulsory superannuation?

By Leith van Onselen The Australian’s Adam Creighton has penned a thought-provoking piece arguing to abandon Australia’s compulsory superannuation system in favour of a voluntary system: [The Coalition] needs a policy that boosts real wages significantly today… So just what is this dream policy? The government should make superannuation voluntary. The 25-year experiment forcing people to

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Australia’s thieving compulsory superannuation system

By Leith van Onselen The Australian’s Judith Sloan has penned another article attacking Australia’s compulsory superannuation system, claiming it represents a form of “theft”: As the system of compulsory super has developed, it has become clear its two real effects are as follows. First, it forces many people to forgo valuable current consumption — think

9

Ex-Treasury head John Fraser captured by AMP

With AMP’s reputation shot to pieces by the Royal Commission, it has sought to restore its representation by capturing former senior government officials. After recently capturing the chair of the Financial System Inquiry, David Murray, AMP has now has captured recently departed Treasury Secretary, John Fraser: Former federal Treasury secretary John Fraser will join the

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Screws tighten on SMSF mortgage lending

By Leith van Onselen Last month, The Australian’s Robert Gottliebsen warned that the tightening of lending standards pertaining to self-managed super funds’ (SMSFs) property investments threatened severe financial pain to borrowers caught out by the changes: …This is how the scam worked. There are a huge number of unsold, used and new small inner city

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Public scrutiny forces large retail super fund to slash fees

By Leith van Onselen Last week, audited performance data provided to the Australian Prudential Regulation Authority (APRA) revealed that the biggest superannuation fund operated by each of Australia’s four major banks, along with the largest super funds operated by AMP and IOOF, yielded total average annual returns of 2.1% to 3.1% cent in the decade