“Government Revenue is down and confidence is down and the last thing the Government should be doing is tinkering with the superannuation system, leading to further loss of confidence and trust.

”Superannuation is not a cash cow to be milked to meet deficits. And the notion of ”robbing Peter to pay Paul” is short term thinking, leading to an environment that is not conducive to enabling the average superannuation investor to understand, and take an active role, in their retirement
planning.

“Superannuation is a long term strategy and the system needs to be stable and consistent – not a moving feast in response to budget and political pressures.

“Confidence in the system has seen it grow to approximately $1.3 trillion in assets and become the fourth largest private pension market in the world. The compulsory nature of the Superannuation Guarantee, the legislated increase in mandated contributions and the tax advantaged options with respect to member contributions, make the Australian Superannuation system a strong and robust industry” said Mr Klipin.

“The increase in mandated contributions from 9 – 12% is a bold move, and well supported by the AFA, but the Government now needs to ensure that the incentives are attractive to all income levels and life stages.

“The Government should be encouraging people to fund their own retirement and incentives which do this long term will lessen the drain on the public purse. The deferral of higher contribution caps for the over 50s and the increase in tax on concessional contributions for higher income earners are hitting the very people who are in a position to focus on ensuring adequate retirement savings and, as we know from history and the super surcharge, the administrative burden will be high.

“Australians want, and need, certainty and confidence in their super. They want certainty in the rules and the ability to forward plan.

“Employers also want certainty and the ability to deliver a true workplace benefit to their employees – not just meet a legal requirement.”

Mr Klipin stressed that “The need for long term planning can’t be emphasised strongly enough. If superannuation and retirement planning for consumers is a long term strategy, then so must be the Government’s treatment of the environment.

“Finally, we come back to what is critical in underpinning confidence by consumers, and that is quality financial advice – the right long term strategy, the right investment, the right insurance cover.”

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